Saturday, December 29, 2012

By All Means, Let's Go Over the Fiscal Cliff

The so-called federal fiscal cliff is the combination of the expiration of the Bush-era temporary tax cuts, the temporary cuts to the Medicare and Social Security taxes, and a set of previously-enacted "automatic" spending cuts.  The conventional wisdom is that this will all be bad for the economy, and that that US should continue to borrow money from foreigners like to Chinese to spend on ourselves.

Only academics could buy that manure -- that the way to fight the effects of massive, long term overspending, much of it via borrowed money, is to borrow much more to spend more.  They argue that less federal spending will cause people to worry about the economy and, with less money in their pockets via higher taxes, they will spend less and therefore "hurt" the economy.

The US is functionally bankrupt and must cease going into deeper debt to spend on ourselves now.  Plain and simple.  And one reason the bad economy didn't hurt Obama as much as Republicans hoped for is that a huge proportion of the electorate has been shielded from the Obama spending binge because Republicans, those of the Stupid Party, pressured, or were duped into pressuring, Obama to go along with extending the Bush cuts a few years ago.  So taxes stayed lower while spending skyrocketed.

Enough.  Enough.  Although I don't want to pay higher taxes, especially to fund a Democratic party spending binge that primarily serves to increase dependency on big government (the prime Democrat strategy), people have voted for big government and now everyone must pay up.  When voters are fully paying for bigger government maybe then more voters will think twice about voting for it.

Avik Roy and Marc Thiessen agree (link).

John M Greco

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