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View Diary: Bill Kristol: "It won't kill the country" if millionaires get their taxes raised (181 comments)

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  •  So many people here are focused (6+ / 0-)

    on such a small thing -- taxes on millionaires and billionaires.  That's about $3 or $4 billion a year, as I said above, even if you did something like the Buffet Rule.  That's basically a rounding error in the federal budget.  

    Here's the deal -- the fiscal cliff is worth about $3.7 trillion over nine years.  There's about $2.5 trillion in tax increases (the vast majority of that attributable to households UNDER $250,000) and about $1.2 trillion in spending cuts.

    So, even if the President gets tax increases on not just millionaires and billionaires, but also on two-income households over $250,000 -- that's about $80 billion a year, or $320 billion over nine years.  That's less than ONE TENTH of the deficit reduction that Congress agreed to in order to raise the debt ceiling the last time.  

    There's no way -- nada, zero, zilch -- that you get the House to agree to vitiated the last deficit reduction agreement in order to raise the debt ceiling last time (what put the sequester in place) AND agree to raise the debt ceiling after the first of the year, for $80 billion a year.  Not a chance.  

    Raising taxes on the rich makes such a small difference in the overall scheme of things, I think it gets WAY too much attention, frankly.  I'm pretty sure that eventually the Republicans will agree to raise taxes on millionaires and billionaires, and probably agree to close some deductions/exemptions on households from $250,000 - $1 million (that way they can say they raised taxes on "millionaires and billionaires" while "protecting small business"), especially in exchange for getting rid of the AMT (which is going to hit families as low as $75,000 this spring).  So, let's say a package like that is $50 billion a year, give or take.  (And that's probably generous.)

    In my mind, that's the easy part. Given what was said this morning on the talk shows, I'll bet I could even get the Republicans to agree to that kind of deal -- but it would have to be coupled with significant spending cuts.  The hard part is what ELSE the package is going to have to contain -- what are those spending cuts that the President is going to offer?  

    In my mind, there are two really interesting things to come out of this morning's talk shows:  (1) there is some signal from Republicans that they'd agree to a deal on revenues like I've outlined above; and (2) Bob Woodward put out a document showing what cuts the President was willing to agree to as part of the so-called "grand bargain."  Those two things make me think that reaching a deal is a bit more likely than it was a few days ago.  

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