Fiscal Cliff Fail: Boehner’s Tax Hike Is DOA in the House
December 21st, 2012
Republican House Speaker John Boehner critically misread the last election’s voter mandate. The Republican majority in the House of Representatives was sent there to reduce spending. Even the Democrats in the House lean towards fiscal restraint. The Senate is still full of banker-funded cronies, due to the costs associated with winning a state-wide race, and the President has demonstrated a lack of willingness to consider any serious spending cuts. When he started off the fiscal cliff talks by offering tax hikes on wealthy Americans, John Boehner ruined his own bargaining position and now can’t put together a bill that will pass.
ABC News is reporting that John Boehner has abandoned a plan to raise taxes on millionaires after it was rejected by conservative house members. On January 1st, severe tax hikes will impact all Americans if the Democrats and Republicans can’t put aside partisan bickering and make permanent the temporary tax cuts to which the market has already acclimated. Experts have indicated that raising taxes at this time could harm the struggling economy.
Just in Time for the Holidays: New Taxes
President Obama has demonstrated unlimited thirst for tax hikes on the wealthy, no matter the consequences. Obviously, the House could have passed a bill making the fiscal cliff tax cuts permanent, and this would have placed the ball in the President’s court. In fact, if the GOP wanted to extend those tax cuts in a way that might actually stick and solve the deficit, they could have combined the tax cut extension with 10% across-the-board spending cuts to everything including the Pentagon.
Instead, Boehner supplicated instantly to the concept of raising taxes on the wealthy, despite there being no thirst for this among his colleagues, allowing his party to take the blame for the upcoming tax rate increase. The fact that Boehner didn’t realize that Republicans weren’t willing to break their tax pledges shows that he is wildly out of touch with his own party.
Down in the 4th Quarter, Boehner Punts
The GOP hungers for fiscal restraint. When Boehner booted all of the fiscally conservative house members from their committee assignments, he enraged his own base. In previous sessions, the House has been able to extend expiring tax cuts. This time, it looks like there is little chance of a deal. This means taxes will go up, probably on all Americans, and Boehner will be blamed.
The fiscal cliff debate represents a missed opportunity. Finally, we have the type of political situation that calls for a serious discussion on spending. The government is spending at experimental rates, never before tried. Obama and Boehner seek to solve this problem by raising taxes on wealthy Americans, despite the fact that this strategy could only fund the government for around eight days. This is like a college student arguing whether or not to go donate blood in exchange for forty dollars when thousands of dollars worth of bills are due the next day.
So, with just ten days left until we go over the fiscal cliff, John Boehner pulled his millionaire tax-hike scheme, citing lack of support. The House took no action on the issue, and the markets tanked. Boehner punts to Obama and the Senate with the clock winding down.
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