A Nation Challenged

As Both Parties Become More Firmly Polarized, Our Prospects of Renewed Prosperity Dwindle

It would be comforting to believe that Democrats and Republicans will accept that we are a nation ideologically split right down the middle, using the election results as a mandate to work together to strike a grand bargain which will finally rein in runaway spending through enacting the entitlement program reforms demanded by the Republicans and revenue enhancements insisted upon by the Democrats, much of which would come from increasing the tax burden of higher income Americans. In close observation of the current crop of political and media figures, there is every reason to be pessimistic.

On a recent installment of Fox News Channel's "Hannity," conservative icon Sean Hannity stated that he has not quite forgiven New Jersey Governor Chris Christie for burnishing the president's credentials when Christie praised him for his response to aid New Jerseyans suffering from the effects of devastating Hurricane Sandy. I suppose in Sean Hannity's eyes, Christie should have told the president that he is not welcome in the state immediately preceding an election or that Christie should not have acknowledged Mr. Obama's relief efforts or thanked him for it.  I applaud Governor Christie for doing what was right for his beleaguered and suffering constituents: asking the president for help, welcoming him to New Jersey to accept it, touring the devastated state with him, and acknowledging his fine efforts.

Newly-elected Kansas U. S. House Republican Tim Huelskamp has indicated that he will not compromise because compromise is not possible when the parties are so far apart. In turn, a number of Congressional Democrats, asserting that they have the upper hand by virtue of President Obama's re-election, are backing away from their prior willingness to consider reform of entitlement programs, this notwithstanding the fact that the president's victory in the popular vote was slim, that the heartland and the South are solidly red/Republican states, and despite the fact that opponent Mitt Romney won twenty-four states, hardly a landslide for the Democrats.

Americans for Tax Reform Founder Grover Norquist continues to loom large on the political stage as many current members of Congress have signed his pledge that they will never vote to increase taxes. I support a general credo of tax restraint and always seeking tax reduction, but one should "never say never", boxing themselves in to what can turn out to be an unrealistic promise as circumstances change.

If the Democrats hold to what appears to be their current position of no entitlement reform, Social Security, Medicare, and Medicaid will run out of money sooner rather than later.  If the Republicans hold to their position of "tax cuts for all or tax cuts for no one," then taxes will increase markedly and a recession would be likely to ensue next year.  I believe that on the issue of whether to extend the George W. Bush tax cuts for some or for all, the Republicans hold a losing hand.  Just as they were blamed for the government shutdowns that occurred under President Bill Clinton in 1995 and 1996 and forced to retreat, they are likely to be blamed for standing in the way of preserving middle class tax relief for what President Obama classifies as "the 98%".

It appears that the positions of Republicans and Democrats have hardened to an extent that neither side retains a level of flexibility which would enable landmark legislation to be enacted.  If this remains true, then we are in a great deal of trouble.

When we assess who is to blame for the dire state of the nation, we must look to ourselves. We placed into office and returned to office largely the same individuals who have fiddled as the nation sinks.

This post is contributed by a community member. The views expressed in this blog are those of the author and do not necessarily reflect those of Patch Media Corporation. Everyone is welcome to submit a post to Patch. If you'd like to post a blog, go here to get started.

Ernie November 21, 2012 at 07:01 PM
@DanielBosh. Where do you get the idea that the deficit will be reduced ONE RED CENT if we go over the "fiscal cliff"???? Could you please cite ANY reference or source for your misinformation?? And, the CBO DOES NOT state that the defiicit will be reduced by the cliff, so please cite an actual document or source. Why on Earth do you find it "silly" to think the Federal Budget should be balanced???? LOL! I find it ABSURD that you think it should not be balanced!!!!
Ernie November 21, 2012 at 07:09 PM
@DanielBosh. I am amazed at your unwillingness to deal with actual facts and data. Hauser's Law is valid. I did not say that Tax Revenues were unaffected by Tax Rates, I said, as the Law states, that the reciepts as a percentage of GDP do NOT change to any statistically relevent amount with a drastic change in Rates. Hauser's Law is valid, your need to classify it as nonsense says just about all that needs said about your williingness to discuss actual facts ad data. Yes, receipts have varied in the range you cite, but the Tax Rates during those same periods have varied from north of 70% to the 36% Rate on top earners we now have. Hauser's Law is a perfect illustration that Tax Receipts are dependent on Economic Activity. And, if you look at the income Tax Revenues to the Feds when marginal Tax Rates were dropped throughout modern history, the REVENUES did go up. Again, that is just data you seem unwilling to accept. These are NOT "conservative ideas" as you need to claim. They are Economic Realities. But, as usual, folks like you just want to play the "us vs. them" game and sit back and wonder why the Economy sucks.
DanielBosh November 22, 2012 at 07:18 AM
@ernie http://www.cbo.gov/sites/default/files/cbofiles/attachments/FiscalRestraint_0.pdf "Under current law, the federal budget deficit will fall dramatically between 2012 and 2013 owing to scheduled increases in taxes and, to a lesser extent, scheduled reductions in spending—a development that some observers have referred to as a “fiscal cliff.”" That's from the Congressional Budget Office. I would suggest -- in the absence of any official legal opinion -- that if you were not aware of these facts already, you should not comment, criticize, converse upon, or otherwise deliberate on matters concerning fiscal issues relating to the federal government of the United States or any other fiscal issues pertaining to a government, private enterprise, or any other entity that in the course of its business may come upon issues which may, or may evenly remotely be related to something that could, in good judgement, be called fiscal. Without giving further pertinent advice in the absence of dual compensation, I would go no further than to say you should give no opinion -- public nor private -- in light of the facts at hand. And you should further abstain from participating in our republic in any way which we will call -- for our purposes -- extra-communicative, e.g. voting.
DanielBosh November 22, 2012 at 07:33 AM
@ernie I do not wish to give the impression that the rest of your comment warrants any sort of serious response, but for your own educational purposes and -- dare I be so bold as to say -- for the educational purposes and future of our country, I will respond. Our country has been in debt almost continuously for its entire existence. Due to the growth of its economy, though, it has been able to quite easily service this debt. Because a government is not a person or a household in any number of respects (it will not die, it can print unlimited money, it can easily augment its revenue, etc.) it does not need to balance a budget like a human being would need to. Indeed, some economists would say that it is beneficial for a government to stay continuously in deficit in order to invest in and grow its economy. The six short periods that the United States ran budget surpluses (the last being under Clinton in the late 1990s) all ended in recessions. That is not to say that surpluses are bad for the economy, but rather that they are not necessarily good for the economy. Beyond that, I do not have the economic knowledge to give a further substantiated opinion. But what is clear, is that almost every industrialized country to date has continuously accumulated debt since its existence, without any expectation from the public that that debt would be paid off in full at any given time. So now I ask you, why is it such a good idea to always balance our budget if history says otherwise?
DanielBosh November 22, 2012 at 07:50 AM
@ernie " I did not say that Tax Revenues were unaffected by Tax Rates" But before you said: "the individual Tax Rate has ZERO impact on the amount of Tax Revenue coming in to the Federal coffers" And 3-4% is statistically significant! It's based on %GDP so anything is statistically significant! " Yes, receipts have varied in the range you cite, but the Tax Rates during those same periods have varied from north of 70% to the 36% Rate on top earners we now have." If you understood our tax system, you would understand that tax brackets can change the progressiveness of our tax system without changing the revenue. That 70 percent tax was levied on a much smaller percentage of people than the current top rate. In fact, there was a time when there was only one person in the entire United States -- John D Rockefeller -- who was known to be taxed in the top bracket. "And, if you look at the income Tax Revenues to the Feds when marginal Tax Rates were dropped throughout modern history, the REVENUES did go up. Again, that is just data you seem unwilling to accept." That's just not true. The fact that you think it is true is just further evidence that nobody should ever believe anything you have to say on fiscal policy. There is a "optimal effective tax rate," but studies have shown that that rate is about 3-4 times the effective rate most people pay today. There has been no empirical example in the United States where lowering taxes has raised revenue. Not one.


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