Is the Fiscal Cliff the Lesser of all Evils?

FiscalCliffThe 1st of December has come and gone.  We are headed for that cliff observing no speed limit signs, speed humps, or sharp curves to slow us down.  We are running stop signs and red lights like we want to go over quickly.  If no deal by 01-01-2013, we will go over the cliff resulting in monster-size tax increases affecting every American to the tune of an additional $2,000 in taxes to the poorest Americans, and draconian spending cuts that include the military, making us less safe in the world, as well as hardships for the elderly and disabled.  Pundits claim this will spin the nation into recession that could outlast the Great Depression of the 1930s. Now what are the alternatives?

Both sides of the aisle agree with tax cuts and tax breaks for the middle class.  The Obama Democrats want the wealthiest Americans to pay more taxes, while Republicans are steadfast opposed albeit most Republicans are in favor of eliminating deductions so wealthy pay more but not for raising rates.  The goal of Obamanomics is to balance the budget on the backs of the wealthiest Americans.  To many of the middle class, a soft sell.  But the Boehner Republicans have our backs more than [you] think.  Obamanomics would throw the baby out with the bathwater as taxing the economic group with the greatest job creation potential would stymie job creation and even lead to massive layoffs and even corporations going bankrupt.   I both emphasize and sympathize middle America’s quest to win the war on greed.  But right now, we need the greedy—they do know how to raise capital and run profitable businesses.  Although in a democracy we cannot force them to create jobs, many of them want to so they are not doing it all to themselves and even if we can’t get wages up to the level we desire immediately, overworked and underpaid is better than unemployed and no means of support.  Before anyone can discuss politics, one must first discuss mathematics.  It may be possible to balance the budget on the backs of the middle class, as one side says, although not a popular choice.  It may be possible to balance the budget on the backs of the wealthy, as one side says.  But it not mathematically, let alone politically possible to balance the budget on the backs of the unemployed.  I am not flat out saying no to the wealthiest Americans paying more taxes, but I am saying not yet.

Senator Lindsay Graham (R-SC) is saying he will reach across the aisle with Obama Democrats on higher taxes for the wealthy if and only if we get in return entitlement reform.  As you know, I am one of the biggest proponents of entitlement reform I know.  But I do not favor taking away from the elderly and disabled who are already dependent on the entitlements.  I once pointed out the preamble of the Constitution specifically says that we must prepare the common defense and promote the general welfare; the world welfare not a reference to the modern welfare stated started by Franklin Roosevelt.  But we do have a constitutional obligation not to leave people who cannot help themselves with any means of support whatsoever.   Then the question becomes is entitlement reform, if not drastic, be enough?  A modified limited entitlement system may be the right formula for an America that can operate with a balanced budget; but mathematically, it by itself along with tax cuts to the wealthy is not enough to cure America’s debt, and that must be achieved first.

It goes back to the days of slavery when in-between the Jamestown settlement and the cotton gin, in the eighteenth century when our nation was being formed, when many plantation owners including southerners considered their slaves an expense and moved to free them.  Ben Franklin, who was part bigot in his time and part humanitarian, wanted to send the freed slaves back to Africa.  His logic was not totally flawed; they did come from Africa and were involuntarily deported resulting from the infamous Rumà Molasses à Slaves triangular trades that brought slavery to this newly founded land in the first place.  But many [African Americans] of the day refused to go back to Africa even if it meant being rein slaved, as too many generations had past and they were rooted here in America.  Then the cotton gin, the Civil War, and finally the thirteenth Amendment abolishing slavery throughout the land.

We are experiencing the same thing with this modern day form of slavery better known as the welfare state and other entitlement dependencies.  If a generation is thirty-three and a third years, the third generation of the New Deal is living today and unlike the victims of the Great Depression, these people, for better or for worse, were born into the entitlement system.  They know no other form of life.  For many years, even with the American Dream at their doorsteps, bigotry and discrimination deprived them.  Laws have changed, bigotry, although will always exist, is much less than ever in American history, and we have elected our first African American president (make no mistake, Obama’s skin color has nothing to do with my opposition to most of his policies), but it is not that easy this group of people from entitlements; especially if you are going to create a huge tax burden on small business owners, further deterring the ones with the greatest potential to work for themselves from starting businesses.  Remember Joe the Plumber?  He can’t make it with this kind of tax structure.

In my most recent blog about the The Ace up the Sleeve, I was referring to something at the state level.  There is a similar third evil to take the lesser of that does not seem to be on the table; the overall bureaucracy.  Do we need representation in the House of Representatives in four-hundred-thirty-five districts?  Or can we consolidate districts and have a more streamlined house with fewer salaries to pay?  How about the president, senators, congressmen, cabinet members, supreme court justices, etc. taking pay cuts?  They serve an important purpose, but their role in job creation and paving the way for the American Dream is limited to policy-making.  How about turning Amtrak over to a privately-owned railroad company?  Departmental consolidation?  Privatizing what can be privatized?  Cutting funding to Big Bird and Planned Parenthood—I am not bashing either one; but if you have to choose between that and Social Security and Medicare, and between taxing people out of house and home, what really is the lesser of the three evils.

I would hate to go over the fiscal cliff, but it may be the best option we have.  If we don’t go over this cliff, chances are we will go over a bigger cliff later which could mean national bankruptcy.  In spite of everything, everyone is making it clear that it will affect every American; at least that is fair.  Asking one group or class to sacrifice when all you get is a reduction in debt, not a balanced budget in return is a tall order for all groups and classes.  We need to get rid of unions, bring back manufacturing, privatize all services that can be privatized, and create a working small-business economy.  No question both parties in Washington would love to invest in this scenario; but we need a balanced budget first and none of the compromises are going to achieve that.  Furthermore, going over the cliff will yield a crisis.  Not that I welcome a crisis, but times of crisis bring out the best in people.  Sadly, I see it as the only way to bring people together; not just those who represent us in Washington, not just Wall Street and Main Street, but Elm Street and Mockingbird Circle as well.


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