Skip to main content

The U.S. Senate rang in the New Year with a vote, 89-8, on a deal meant to avert the "fiscal cliff." The House is expected to vote on the deal before Wednesday. Read Hunter's take on it last night here.

The New York Times sees pluses and negatives in the deal:

For the first time since President George W. Bush began the country’s long slide into debt by cutting taxes in 2001, an agreement was reached late Monday in the Senate to raise income taxes on the rich. That’s what makes the deal significant: assuming it is approved by the House, it begins to reverse the ruinous pattern of dealing with Washington’s fiscal problems only through spending cuts.

Nonetheless, this deal is a weak brew that remains far too generous to the rich and fails to bring in enough revenue to deal with the nation’s deep need for public investments. Given that the Bush-era tax cuts expire on Jan. 1, Republicans were forced to give ground on their philosophical opposition to higher taxes, but they made it impossible to reach a farsighted agreement that truly grappled with government’s role in fostering improvements to education, transportation and manufacturing.

Matt Yglesias at Slate:
From the viewpoint I outlined on December 13—"Cutting Spending to Obtain Tax Hikes Is Nuts"—this is a decent deal. Relative to what Obama had already agreed to, there are no spending cuts whatsoever in this package. In exchange, he ended up securing much less tax revenue than he was initially looking for. That's an epic defeat for the Pete Peterson and "Fix The Debt" crowd, but even though liberals are disappointed with this they didn't end up actually losing anything the way they were going to in deals that cut Social Security benefits or raised the Medicare eligibility age. Conservatives, meanwhile, can say that in the face of an objectively unfavorable situation they kept taxes remarbly low and have maintained their leverage to press for further spending cuts in February.

On to the next crisis.

Matthew O'Brien at The Atlantic sees a major flaw in the deal:
The end of the payroll tax cut, and the lack of any substitute, is the biggest thing missing from the fiscal cliff deal. Without it, the Tax Policy Center figures middle-class households will see their after-tax incomes fall around 1.5 percent, which the CBO estimates will cost us around a half million jobs. Why has the payroll tax cut become such a political orphan? Well, Republicans aren't crazy about more stimulus, and Democrats aren't crazy about a tax cut that makes Social Security more dependent on general revenues, and thus less politically solvent. But there is a way around this. It's an idea Democrats used in 2009 and floated again a few months ago, before dropping. That's bringing back the Making Work Pay tax credit -- and doubling it. [...]

If the Democrats want to trade tax revenue for tax credits, as seems to be the case, they should at least hold out for the most stimulative credit out there. Making Work Pay puts more money in the hands of working and genuinely middle-class households -- households that are more likely to spend that money, and thus put people back to work.

A fiscal cliff deal that raised revenue from the rich, gave tax credits to the middle-class, and delayed the sequester -- along with the no-brainers like extending unemployment insurance, patching the AMT, and doing the doc fix -- is a deal both sides could get behind. Democrats would get a bit less revenue than they want, Republicans would give up a few more credits than they want, and everybody would avoid the austerity that nobody wants.

Katrina vanden Heuvel, writing at The Washington Post outlines some policy priorities for the new year, including addressing income inequality:
We need to rebuild a middle class if we want to again have a vibrant, growing economy. That requires a lot more than repealing the Bush tax breaks for the top 2 percent. We should be lifting the minimum wage, empowering workers to bargain for a fair share of the productivity and profits they help to generate, and limiting CEO pay packages that give them multimillion-dollar incentives to ship jobs abroad or plunder their own companies. Congress and the White House might also imitate the Federal Reserve and keep pressing the stimulus pedal until we move much closer to full employment.
National Journal's Michael Hirsh on Biden's legacy:
The previous two vice presidents, Cheney and his predecessor, Al Gore, significantly changed that power dynamic. But on Biden's watch the "OVP" -- Office of the Vice President -- has become something even more: almost a conjoined twin to the presidency, organically linked and indivisible from the Oval Office. Cheney succeeded for a time by creating a kind of shadow presidency, yet there's nothing shadowy about Biden. Indeed Biden remains, in many respects, the anti-Cheney. [...] if Barack Obama does leave a lasting legacy on gun violence that comes out of the terrible tragedy in Newtown, Conn., Biden will be a big part of it. And if anything like an agreement is reached on fiscal issues, Biden is likely to be part of that as well. His long Senate tenure, and the many relationships he developed across the aisle, are once again proving crucial.
At The Washington Post, Eugene Robinson calls for national action this year on reducing gun violence:
Guns do kill people. Our national New Year’s resolution must be to stop the madness. [...]

This must be the year when America says: No more. [...]

Politicians, beginning with the president, must show the courage to stand up to the gun lobby. They must do it for the children of Newtown. They must do it for all the 11,000 men, women and children who otherwise will not live to see New Year’s Day 2014.

The Chicago Sun-Times agrees.

The Washington Post's editors look back at FDR's legacy and draw from it lessons for the road ahead:

There was a lot more to be feared than fear itself: drought, disease, hunger, economic failure, Hitler. But Franklin D. Roosevelt, in addition to lifting the country’s spirits, had hit on an important point about the American character in that inaugural address, one that was essential to recovery. It was the idea that fear, the sort of paralytic, debilitating fear he had in mind, discourages people from action and dims their hopes. It strikes not only at the economy but at America’s most essential quality: its basic and enduring optimism.

Will the state lead the rest of the country or set back the environmentalist cause?
If there is truly an American “exceptionalism,” it’s less likely to be found in concepts of limited government and divided powers than in the belief of the people, from the very first days, that things can always be made better. It was the refusal to acquiesce in fatalism and resign oneself to acceptance that created the New World and that has kept this republic going for well over two centuries.

Today FDR’s words may be more true than they were 80 years ago, when the country did face truly catastrophic conditions. Our problems as the new year begins are not insuperable; they are manageable but greatly exacerbated by fear, much of it created and nurtured by people who make a good living off it. Whether it is the fear that one’s pension will be cut, guns restricted, income taxed too heavily or medical care infringed, it is often exaggerated and dishonest. There are difficult questions to be dealt with in every matter involving economic progress and the best distribution of public resources, but they can be answered by rational and well-informed discussion. Fear, unreasoning, unjustified fear, has no useful place in it, then or now.

At The Los Angeles Times, Doyle McManus does what very few pundits are willing to do—assess their own punditry record. He writes a detailed mea culpa on all of his failed predictions and outlines where he got it right, too:
My only consolation is that I wasn't as wrong as Newhouse or his Republican colleague Karl Rove, who predicted that Romney would win by a comfortable margin. [...]
If only all pundits would engage in a similar annual self-reflection on their accuracy.

Your Email has been sent.
You must add at least one tag to this diary before publishing it.

Add keywords that describe this diary. Separate multiple keywords with commas.
Tagging tips - Search For Tags - Browse For Tags


More Tagging tips:

A tag is a way to search for this diary. If someone is searching for "Barack Obama," is this a diary they'd be trying to find?

Use a person's full name, without any title. Senator Obama may become President Obama, and Michelle Obama might run for office.

If your diary covers an election or elected official, use election tags, which are generally the state abbreviation followed by the office. CA-01 is the first district House seat. CA-Sen covers both senate races. NY-GOV covers the New York governor's race.

Tags do not compound: that is, "education reform" is a completely different tag from "education". A tag like "reform" alone is probably not meaningful.

Consider if one or more of these tags fits your diary: Civil Rights, Community, Congress, Culture, Economy, Education, Elections, Energy, Environment, Health Care, International, Labor, Law, Media, Meta, National Security, Science, Transportation, or White House. If your diary is specific to a state, consider adding the state (California, Texas, etc). Keep in mind, though, that there are many wonderful and important diaries that don't fit in any of these tags. Don't worry if yours doesn't.

You can add a private note to this diary when hotlisting it:
Are you sure you want to remove this diary from your hotlist?
Are you sure you want to remove your recommendation? You can only recommend a diary once, so you will not be able to re-recommend it afterwards.
Rescue this diary, and add a note:
Are you sure you want to remove this diary from Rescue?
Choose where to republish this diary. The diary will be added to the queue for that group. Publish it from the queue to make it appear.

You must be a member of a group to use this feature.

Add a quick update to your diary without changing the diary itself:
Are you sure you want to remove this diary?
(The diary will be removed from the site and returned to your drafts for further editing.)
(The diary will be removed.)
Are you sure you want to save these changes to the published diary?

Comment Preferences

  •  Happy New Year! (19+ / 0-)

    The nays on the deal, for those wondering:



    Lautenberg, DeMint and Kirk did not vote.

  •  The Times is right: "A Tepid Deal" (7+ / 0-)

    For moving way up from 250, they should have gotten a higher rate on capital gains and dividends.

    Chuck Hagel for Defense Secretary

    by Paleo on Tue Jan 01, 2013 at 04:39:33 AM PST

  •  I think you meant to type (2+ / 0-)

    Matt Yglesias at Slate.

  •  Happy New Year, Georgia! Thanks for the roundup (6+ / 0-)

    I like the photo of newspaper headlines.  Gives a feel for what they're saying around the country.

    Is it too much to hope that this year won't be as bad as last year with respect to hurricanes, droughts, floods, fires, snowstorms, and the like?  And mass murders of children and violence against women?

    I won't even talk about the government.

    "Religion is what keeps the poor from murdering the rich."--Napoleon

    by Diana in NoVa on Tue Jan 01, 2013 at 04:44:39 AM PST

  •  Thank you President Obama for giving us a (3+ / 0-)
    Recommended by:
    Paleo, heavenlytails, Ender

    payroll tax holiday, that gutted SS, and now will be seen as a tax hike by you. Pure 11th dimensional chess.

    •  It "gutted" Social Security? (6+ / 0-)

      How so? The cut was paid for (from the general fund).

      “We are not a nation that says ‘don’t ask, don’t tell.’ We are a nation that says ‘out of many, we are one.’” -Barack Obama

      by skohayes on Tue Jan 01, 2013 at 05:18:08 AM PST

      [ Parent ]

      •  Looks like Obama again got a better deal then some (7+ / 0-)

        DailkKos posters will admit.

        Delenda est filibuster!

        by TofG on Tue Jan 01, 2013 at 05:24:34 AM PST

        [ Parent ]

        •  See here for more details (5+ / 0-)

          I posted an excerpt below:

          I'm perfectly satisfied with the results. Whether it will pass the House or not may be a different story.

          “We are not a nation that says ‘don’t ask, don’t tell.’ We are a nation that says ‘out of many, we are one.’” -Barack Obama

          by skohayes on Tue Jan 01, 2013 at 05:33:47 AM PST

          [ Parent ]

        •  It will be at least this weekend until... (6+ / 0-)
          Recommended by:
          Jerry056, skohayes, jofr, Pinto Pony, leu2500, tk421

          ...some grudging acceptance that this deal is a bit more distant from the Apocalypse than initial diaries and the overwhelming comments to date suggest.

          It is less viscerally satisfying than going over the curb/speed bump/speed dip...whatever. The big thing out of this deal for me is that more than a couple dozen GOP Senators voted to raise taxes on somebody, which hasn't happened in 22 years. That will have consequences well past this Congress, well past this decade.

          Let me be clear: those who think this is a bad deal and puts us in worse position than before are entitled to that opinion. If you express it analytically and without casting personal aspersions, I'm likely to "rec" it even if I disagree with some or most of it. But I fully expect all of you to continue to fight and organize for all the battles to come. Because no one promised that any single event would be some "ultimate victory". That only happens in movies and video games.

          When you are right you cannot be too radical; when you are wrong, you cannot be too conservative. --Martin Luther King Jr.

          by Egalitare on Tue Jan 01, 2013 at 05:44:25 AM PST

          [ Parent ]

          •  The deal PERMANENTLY lowers taxes on the... (3+ / 0-)
            Recommended by:
            Ender, Buzzer, Laconic Lib

            ...wealthy and PERMANENTLY lowers the estate tax from 55% to 40%. That stinks.

            It also gives away ALL of Obama's leverage on the debt ceiling, so the true stench of this deal will be apparent in about two months.

            Just wait and see.

            •  not really (0+ / 0-)

              the sequester for the other cuts come in 2 months.  That is a big chunk of defense spending cuts in there that Obama KNOWS republicans must pass.

              95% of all life forms that once existed on earth are now extinct. It is only a matter of time until the Republicans follow suit.

              by PRRedlin on Tue Jan 01, 2013 at 06:05:42 AM PST

              [ Parent ]

              •  I don't see how that is leverage (1+ / 0-)
                Recommended by:

                Nobody wants those cuts to happen. Obama said himself during the debates that those cuts are never going to happen.

                •  kabukki theater (2+ / 0-)
                  Recommended by:
                  Egalitare, Ender

                  no cuts will happen

                  95% of all life forms that once existed on earth are now extinct. It is only a matter of time until the Republicans follow suit.

                  by PRRedlin on Tue Jan 01, 2013 at 06:15:21 AM PST

                  [ Parent ]

                •  I'd be thrilled to see defense cuts happen, Ender (2+ / 0-)
                  Recommended by:
                  Ender, skohayes

                  There's lots of room to tighten up the war machine.

                  Cantor just announced that "no decision on taking the bill to the House will be made today."

                  “Social Security has nothing to do with balancing a budget or erasing or lowering the deficit.” -- Ronald Reagan, 1984 debate with Walter Mondale

                  by RJDixon74135 on Tue Jan 01, 2013 at 07:16:33 AM PST

                  [ Parent ]

                  •  I'd be thrilled too. Don't see it happening though (0+ / 0-)

                    Thanks for the news about the House.

                    It reminds me of a quote from the movie, Airplane:

                    Dr. Rumack: Captain, these passengers don't have much time. How soon can we land?
                    Capt. Oveur: I can't tell.
                    Dr. Rumack: You can tell me, I'm a doctor.
                    Capt. Oveur: What I mean is, I don't know.
                    Dr. Rumack: Well can't you take a guess?
                    Capt. Oveur:...Not for another two hours.
                    Dr. Rumack: You can't take a guess for another two hours?
                    Capt. Oveur: No what I'm saying is we can't land for another two hours.

            •  There's no "PERMANENT" in tax law (5+ / 0-)

              They tweak something on it every year, and when the GOP and its think tanks go back (tomorrow) to harping on the deficitdeficitdeficit, and keep insisting on a thorough-going revision of the tax code, as far as I'm concerned they should be careful what they pray for as they might get it. If the Democrats retake the House in 2014 (dream on, but just saying. . .), or 2016, all sorts of things are possible.

      •  Falt out lie. (3+ / 0-)
        Recommended by:
        Ender, Sam I Am, Laconic Lib
        Impact on Social Security. Payroll taxes are the main source of revenue for Old Age, Survivors and Disability Insurance (OASDI), or Social Security benefits. The unfunded liability of the OASDI program is the difference between the benefits that have been promised to current and future retirees and projected collections of dedicated taxes. As of this year, the unfunded liability into the indefinite future, called the infinite horizon, is $20.5 trillion plus a trust fund debt of $2.5 trillion, according to the Social Security Trustees’ report.

        The payroll tax cut has had a negative effect on the annual operations of Social Security. Since its inception it has:
         •Reduced Social Security payroll revenues 16 percent; and,
         •Decreased revenue $103 billion in 2011 and an estimated $112 billion in 2012.

        Though seemingly a drop in the bucket, the payroll tax cut increased Social Security’s real unfunded liability by $215 billion plus interest.
        •  IT CAME FROM GENERAL FUND (0+ / 0-)

          95% of all life forms that once existed on earth are now extinct. It is only a matter of time until the Republicans follow suit.

          by PRRedlin on Tue Jan 01, 2013 at 06:06:23 AM PST

          [ Parent ]

          •  Iprovided a link. Where is yours? (0+ / 0-)
            •  Kevin Drum, of Mother Jones (2+ / 0-)
              Recommended by:
              Egalitare, DRo
              Does the recently extended payroll tax cut harm the solvency of the Social Security trust fund? Answer: no it doesn't. The shortfall is made up with payments from the general fund, so the trust fund suffers no loss of income at all.

              “We are not a nation that says ‘don’t ask, don’t tell.’ We are a nation that says ‘out of many, we are one.’” -Barack Obama

              by skohayes on Tue Jan 01, 2013 at 06:17:14 AM PST

              [ Parent ]

              •  Thanks for the link. So you approve of gutting (0+ / 0-)

                SS with general funds?

                •  You haven't shown me (1+ / 0-)
                  Recommended by:

                  where they've gutted Social Security. Your own link shows an increase in Social Security from government subsidies (which would be the general fund):

                  , the law requires that the payroll revenue forgone by the holiday be replaced from general revenue. As a result [see the figure]:

                  Currently, 27 percent of Social Security revenues come from general government revenue, up from 15 percent in 2010.
                  The payroll tax component of Social Security revenue has fallen 10 percent, from $637 billion to $564 billion per year.

                  IOW, as revenues have fallen from the tax holiday, the government has paid for those losses from the general fund.

                  “We are not a nation that says ‘don’t ask, don’t tell.’ We are a nation that says ‘out of many, we are one.’” -Barack Obama

                  by skohayes on Tue Jan 01, 2013 at 06:45:56 AM PST

                  [ Parent ]

                •  your own link (2+ / 0-)
                  Recommended by:
                  leu2500, skohayes

                  shows that you are wrong, you're just not reading it correctly.  the money going into ss is the same, it's just reporting from different sources.

                  95% of all life forms that once existed on earth are now extinct. It is only a matter of time until the Republicans follow suit.

                  by PRRedlin on Tue Jan 01, 2013 at 06:58:12 AM PST

                  [ Parent ]

                  •  The source *matters* (0+ / 0-)

                    Social Security, by law, is required to be actuarially sound for 75 years into the future, on the basis of FICA taxes and the benefits it pays out.  It's not part of the Congressional budgetary process, at least not as originally conceived.

                    Talk of a crisis in Social Security has always been a canard, put about by those who want to slaughter that fatted calf down on Wall Street, and has always been fraudulent and ill-motivated (putting aside the few players who might actually be stupid enough to believe the lie).

                    With the payroll tax cut, it can be argued that Social Security is part of the budget problem.  It's still a lying sack of a crappy argument, but it will muddy the picture enough to make it much easier for those who wish to make benefit cuts.

                    Ben Bernanke's comment on Social Security when testifying on Capitol Hill a few years ago: "That's where the money is."

                    •  and that's also (0+ / 0-)

                      where most of our debt comes from.  The government borrows a LOT from SS, and promises to pay it back.

                      95% of all life forms that once existed on earth are now extinct. It is only a matter of time until the Republicans follow suit.

                      by PRRedlin on Tue Jan 01, 2013 at 09:46:06 AM PST

                      [ Parent ]

                      •  So SS's sin is having money... (0+ / 0-)

                        ... the general fund can borrow?

                        Money provided by extra payroll taxes paid by working people over the last 25 years?  And the solution is to break the promises made to those people all through those 25 years, now that it's a bit inconvenient for the wealthy, who have been able to avoid being taxed for what the government wanted to spend, because those working people provided a big pile of assets that government could borrow against?

                        Gotta admit, I have kind of a problem with that.

                        •  that would be (1+ / 0-)
                          Recommended by:

                          the argument from the right.  that if we cut ss benefits, our debts go down.  in other words, we the citizens forgive the debt owed to us by the government.  I have a problem with that as well.

                          both sides are guilty of borrowing from it starting iwth reagan.  

                          95% of all life forms that once existed on earth are now extinct. It is only a matter of time until the Republicans follow suit.

                          by PRRedlin on Wed Jan 02, 2013 at 05:25:45 AM PST

                          [ Parent ]

                          •  Even borrowing needs to be re-thought (0+ / 0-)

                            According to some economists, who sound pretty coherent to me, when we're in a recession, not only is borrowing OK, it's actually not even necessary.

                            In particular, spending more than it takes in in taxes + borrowing is exactly what a country that issues its own currency (unlike California, Greece, and any household) should do, when factories are underutilized, people are unemployed, and there is no inflation.  Our current problem is too few dollars chasing too many goods, so why make any more, why build factories and hire people?

                            In addition to the link above, James K. Galbraith was interviewed by Ezra Klein a couple of years ago on this subject.

    •  O_O (0+ / 0-)

      Bad Obama bad for not reallybutIwannabelieveit gutting SS and then saving it by returning to normal

  •  Thoughts on the New Year and the deal (8+ / 0-)

    The Fiscal Cliff Follies show us three things we need: more Democrats. Better Democrats. Fewer Republicans.

    Republicans since Reagan have spent the decades demagoguing government as a matter of principle, exalting the private sector over the public. They use the fear of government to energize their base the way they used to use the specter of communism - because without an enemy to attack and blame they have nothing.

    No, government isn't the answer to every problem. BUT, there are things only government can do, things the private sector can't or won't. The power of public interest working through government is needed to counter the excesses of private interests. That's never more important than at a time when the concentration of wealth has driven inequality to dangerous levels.

    The radical conservatives dominating the Republican party today (and no, radical conservative is not an oxymoron) have gone far past restraint of government to sabotage, demolition, and outright looting for private gain. Too many Democrats are enabling this; instead of trying to accommodate conservative desires it is time to push back vigorously. The fiscal compromise (which has yet to pass the House) is setting the stage for an ever fiercer battle down the Road.

    If one considers how the Civil War exploded from the festering resentments of compromises in the years leading up to it, this is not reassuring.

    Conservatism is not the answer to our problems. It IS the problem.

    "No special skill, no standard attitude, no technology, and no organization - no matter how valuable - can safely replace thought itself."

    by xaxnar on Tue Jan 01, 2013 at 04:57:19 AM PST

    •  We lost the message war (7+ / 0-)

      And now no one trusts government to do the right thing.
      Over vacation, I got to spend time with my Fox watching uncle, who was practically screaming in my face one night that  "they're all corrupt!".  I literally had to get up and walk out of the room because it was like arguing with pigs- it was doing nothing but wasting my time and annoying the pigs.
      We need to start educating people about the good things government does. Obama is getting better at it, we need to  as well.

      “We are not a nation that says ‘don’t ask, don’t tell.’ We are a nation that says ‘out of many, we are one.’” -Barack Obama

      by skohayes on Tue Jan 01, 2013 at 05:23:48 AM PST

      [ Parent ]

      •  He believe that... (0+ / 0-)

        ...because he wants to, not because anyone lost a message war. Indiscriminate screaming is easier than having to question personal prejudices.

        "There is no room for injustice anywhere in the American mansion." Lyndon Johnson

        by pkgoode on Tue Jan 01, 2013 at 11:16:09 AM PST

        [ Parent ]

    •  And the way to better Democrats (6+ / 0-)

      is through the primary process. Republicans in Congress are quaking in their boots for fear of offending the Tea Party and conservatives general and facing a primary on the right which they may very well lose.

      Democrats need to feel that fear from the left, from progressives, from liberals, from labor.

      They need to fear us more than they fear Wall Street. They need to be forced to listen to the people.

      Given that one party in America is a wholly owned subsidiary of Wall Street and the other party a partly owned one, it's time to:

      Primary Wall Street. (not just occupy it)

      Otherwise, given how gerrymandered the House districts are, given how dependent all candidates are on big money to win elections, there will be no democracy, just Wall Street getting its way again and again and again.

      Some of you may criticize this as a "purity" campaign. But it is the only way to make Democrats, corrupted by Wall Street money, stand up for the principles the party once stood for.

      If you are opposed to using the primary process to elect Democrats who listen to Main Street rather than Wall Street then you are working for Wall Street, donating your time and effort to Wall Street, when you work to get Democrats elected.

      In just a few short weeks, in yet another "fiscal cliff" crisis that will come along as a result of this raw deal that has been struck (If it passes the House--the Tea Party may save us from ourselves yet again, showing how a fear of being primaried works for the right) they'll be coming after Social Security in some kind of "grand bargain" yet again.

      Where will you stand?

      We can wring our hands in despair or we can learn from the right and we can put some fear into Democrats that we will Primary Wall Street, that we will primary any Democrat who dares to vote for chained CPI or any other cut to Social Security, Medicare or Medicaid.

  •  What leverage does Obama have left (7+ / 0-)

    on the spending cuts now that he's cashed in his hand on taxes?

    Chuck Hagel for Defense Secretary

    by Paleo on Tue Jan 01, 2013 at 05:02:08 AM PST

    •  10 more Ds in the new House (3+ / 0-)
      Recommended by:
      JML9999, skohayes, Pinto Pony

      Republicans: if they only had a heart.

      by leu2500 on Tue Jan 01, 2013 at 05:08:18 AM PST

      [ Parent ]

      •  Well... (4+ / 0-)

        a few extra democrats in Congress won't materially alter the playing field as long as you have significant pockets in both parties(and in the WH) who, by all outward appearances, appear eager to slash these programs.

        This WH seems to think offering cuts to the social safety net is a noble act of self-sacrifice.

        •  If you'll notice (7+ / 0-)

          there are no cuts to the social safety net in this deal and the ratio of revenue to spending cuts is 41:1.
          We get unemployment for another year, plus a 5 year extension on tax credits for college education and the working poor. Also more emergency funding ($30 billion) for the long term unemployed.
          More tax credits for green energy and small businesses extended as well.

          The bill includes a host of tax rate extensions, including five-year extensions of the college tuition tax credit, the child tax credit and the earned income tax credit, which were part of the 2009 economic stimulus package.  

          It sets the capital gains and dividends tax rate at 20 percent, up from 15 percent. Capital gains and dividend income would be taxed at 23.8 percent for singles earning above $400,000 and families earning over $450,000, according to a White House fact sheet.  

          It reinstates the Clinton-era limit itemized deductions for individuals earning over $250,000 and families earning over $300,000.  

          It permanently patches the Alternative Minimum Tax and extends a variety of expiring business and energy tax provisions for one year, including the research and experimentation tax credit and 50 percent bonus depreciation.  

          “We are not a nation that says ‘don’t ask, don’t tell.’ We are a nation that says ‘out of many, we are one.’” -Barack Obama

          by skohayes on Tue Jan 01, 2013 at 05:30:30 AM PST

          [ Parent ]

          •  Oh, I'm aware of that... (4+ / 0-)
            Recommended by:
            Buzzer, tb mare, DSPS owl, Laconic Lib

            And let me state unequivocally that I'm delighted that Medicaid/SS and Medicare have been left alone. That's all I wanted for Xmas.

            But what concerns me is the fundamental dynamic that lead us to the brink of Chained CPI(or other cuts to the social safety net) are still largely in place:

            1) A republican party that dreams of gutting these programs and pursues their defunding every moment of every day.

            2) A corrupt or ideologically conservative beltway media that hypes these crises and then tries to capitalize on the confusion.

            3) A democratic party that, to my untrained eye*, appears willing to cut these programs(even Nancy Pelosi argued CCPI wouldn't amount to a cut!).

            So, while I celebrate the fact the safety net is intact. I realize the republicans and the democrats are going to come back after them at a later date.

            *Unless of course, all the times where it seemed Pelosi, Prez. Obama, et al. were offering cuts they were in fact playing a sophisticated trick on the GOP that is beyond my comprehension.

            •  I'm extremely anxious now about what (1+ / 0-)
              Recommended by:
              Laconic Lib

              the president will do regarding the debt ceiling fiasco that looms on the horizon.  He has vowed never to "play that game again," but has also seemingly refused to invoke the 14th Amendment to thwart the Republicans.  Minting a trillion-dollar coin sounds like a dodge, and the Republicans will beat the drums for his impeachment if he even suggests such a thing.

              "In this world of sin and sorrow there is always something to be thankful for; as for me, I rejoice that I am not a Republican." - H. L. Mencken

              by SueDe on Tue Jan 01, 2013 at 06:34:01 AM PST

              [ Parent ]

          •  By the by, I'm also aware that President... (1+ / 0-)
            Recommended by:

            Obama has, again, failed to deliver his promise to turn back Bush's tax cuts on earnings over 250k.

            His statements over the last few years have been carefully crafted to show that his commitment to this was absolute and non-negotiable.

            There's good and bad in this "deal."

            •  I'd rather he raise the ceiling (1+ / 0-)
              Recommended by:

              on higher taxes than cut benefits from Social Security.
              This is called negotiation, you win some you lose some.
              We came out ahead in this deal.

              “We are not a nation that says ‘don’t ask, don’t tell.’ We are a nation that says ‘out of many, we are one.’” -Barack Obama

              by skohayes on Tue Jan 01, 2013 at 06:22:12 AM PST

              [ Parent ]

              •  I'm not freaking out... (0+ / 0-)

                over this deal. But I think it warrants a nuanced discussion.

                I love negotiations--contrary to popular belief, most progressives compromise all the time(the Democratic party/Obama Admin) don't genuflect to the left---trust me). But these Obama/GOP "deals" have earned heightened scrutiny. Too often I see the WH negotiating with itself, surrendering it's leverage preemptively or, worse, just caving to GOP outright.

                Compromises should involve sacrifices from all parties. And the details of any agreement should be informed by relevant events (like enormous electoral victory last month---in which the voters tacitly endorsed Obama's pledge to undo tax-cuts for the rich--for example).

                There's a difference between "give & take" and "gettin' rolled." I prefer the former & have had my fill of the latter.

          •  The cuts to Social Security will come in part ll (2+ / 0-)
            Recommended by:
            Ender, Laconic Lib

            of this crisis, the part that will soon be here because this terrible deal does not address the debt limit ceiling and only kicks the can on budget cuts down the street for two months setting us up for yet another "fiscal cliff" crisis and another opportnity for right wing republican hostage taking.

            This is why people are screaming about what a raw deal, what a horrible deal, what a stupid loss of leverage this deal is.

             It's the fact that there was no lifting whatsoever of the debt ceiling that makes this such an unbelievable capitulation to the republicans and to Wall Street.

            We had a winning hand and we handed it to them in a handbasket.

      •  And how exactly do they make a difference? (0+ / 0-)

        Be specific.

    •  Wait for Chained CPI. (1+ / 0-)
      Recommended by:

      It's the next abomination down the road. And there's nothing we can do about it.

      The Grand Bargain must be stopped at all costs to protect the 99%.

      by cybrestrike on Tue Jan 01, 2013 at 05:20:22 AM PST

      [ Parent ]

    •  Yep. Leverage pretty much gone (2+ / 0-)
      Recommended by:
      betelgeux, Laconic Lib

      LBJ would have gotten personal and said, "You know that defense contract in your district? You can kiss that goodbye unless you vote the right way on this bill." But, Obama won't do that. he thinks that he is above such arm twisting. And no one would believe his threats at this point.

      On the other hand, Obama has said that he won't tolerate any more hostage taking on the debt ceiling. (It should be called the debt pay back ceiling)

      Obama is perfectly within his constitutional rights to say, "Screw you House Republicans! I am going to pay our creditors back and if you don't like it, you can impeach me!"

      "Maybe you should have thought of this when you spent the money in the first place."

      •  LBJ (2+ / 0-)
        Recommended by:
        Sam I Am, skohayes

        had a way different congress.  The Democratic Party was eastern libs and southern conservatives. Repubs eastern libs and real moderates and western conservatives. Parties were still controlled by state bosses and candidates for each party were selected by the bosses. Makes a very big difference.

        Victory is sweet-November 6, 2012

        by al23 on Tue Jan 01, 2013 at 05:42:23 AM PST

        [ Parent ]

    •  Repubs don't want to cut military (0+ / 0-)

      Actually this is a simple one.  Just lower the across the board cuts by 50 percent.  So what if the deficit won' t be cut as fast.  We need jobs not extreme austerity.

      "The real wealth of a nation consists of the contributions of its people and nature." -- Rianne Eisler

      by noofsh on Tue Jan 01, 2013 at 06:12:44 AM PST

      [ Parent ]

  •  I am glad they (7+ / 0-)

    did not cave on Social Security cuts.  Changing to Chained CPI is a cut to Social Security.  I hope this does not become part of a grand bargain around the debt ceiling.

  •  So much for 'eat the rich.' (1+ / 0-)
    Recommended by:

    meanwhile, since her pension was cut, Betsy Ross has been forced to sew her own clothes-
    'no more flags for you'

  •  House goopers rarely disappoint......they're quite (1+ / 0-)
    Recommended by:
    tb mare

    insane you know.

  •  Thanks for including Eugene (5+ / 0-)

    I already feel like the fake crisis of the week has knocked the gravity of Newtown out of the hearts and minds of many. We cannot allow the power of a lobby with only 4 million members to dictate our laws (or lack thereof) and it's time for something to get done.

    I'm pretty tired of being told what I care about.

    by hulibow on Tue Jan 01, 2013 at 05:25:31 AM PST

  •  Red State take on the bill that passed the Senate (11+ / 0-)

    last night written by a guy named "Dan Spencer" made me feel much better about the thing;

    In a move all too reminiscent of the passage of the ever unpopular ObamaCare, last night the Senate voted 89 to 8 to approve the so-called “American Taxpayer Relief Act” (H.R. 8, as amended). The deal was negotiated by Vice President Joseph Biden and Senate Republican Leader Mitch McConnell.

    You can read the 157 page bill here. It is very unlikely that any Senator actually read the 157 page bill before they voted on it. It’s like former Speaker Pelosi said of the Democrats’ ObamaCare bill, “we have to pass the bill so that you can find out what is in it.”

    According to the Congressional Budget Office, the bill increases tax revenue by $620 billion while reducing spending by only $15 billion. That’s right a 41:1 ratio of tax increases to spending cuts. When Presidents Ronald Reagan and George H.W. Bush increased taxes in return for spending the ratios were 3:1 and 2:1 respectively.  We should remember that while those tax increases happened, the promised spending cuts did not.

    That history makes me question the wisdom of Senate Republican Leader Mitch McConnell’s effort to “prevent very real financial pain” by agreeing to tax increases in exchange for another spending cuts to be named later:

        “As I said, this shouldn’t be the model for how to do things around here. But I think we can say we’ve done some good for the country. We’ve taken care of the revenue side of this debate. Now it’s time to get serious about reducing Washington’s out-of-control spending. That’s a debate the American people want. It’s the debate we’ll have next. And it’s a debate Republicans are ready for.”

    The bill raises income tax rates for those taxpayers with incomes more than $400,000 for individuals and $450,000 for couples from 35 percent to 39.6 percent. These higher income taxpayers will also pay higher rates on investment income, with rates on dividends and capital gains rising from 15 percent to 20 percent. Add the 3.8 percent ObamaCare surcharge on investment income — another tax that takes effect in January, and the top rate on investment income would rise to 23.8 percent for those high-income households.

    The bill also raises taxes on couples earning more than $250,000 a year and single people earning more than $200,000 by limiting personal exemptions and itemized deductions.

    Estates taxes will also be increased, with the top rate raised to 40 percent, with the first $5 million in value exempted for individual estates and $10 million for family estates.

    The bill also delays the automatic $1.2 trillion draconian sequester spending cuts for sixty days. The sequester cuts, evenly split between defense and certain domestic discretionary spending, were scheduled to go into effect on Jan. 1, 2013. The $24 billion cost of the sequester delay is allegedly made up with a mix of spending cuts and new revenues from rules changes on converting traditional individual retirement accounts into Roth IRAs.

    Worse, the bill actually increases the deficit by including:

        A permanent fix for the alternative minimum tax.
        A five-year extension of tax credits for college tuition and the working poor, which were enacted as part of Obama’s failed 2009 stimulus.
        A one-year extension for unemployment benefits, affecting two million people.
        The long-term unemployed could count on receiving emergency benefits for another year, at a cost of about $30 billion.

    Now we have to see what happens in the House of Horrors.
  •  Harry Enten, props (0+ / 0-)
    My 2012 polling predictions with hindsight: a few mea culpas
    Rather than crow about when I was right, better to fess up to where I was wrong. I do forecast better performance in 2013

    "Politics is the art of looking for trouble, finding it everywhere, diagnosing it incorrectly and applying the wrong remedies." - Groucho Marx

    by Greg Dworkin on Tue Jan 01, 2013 at 05:39:52 AM PST

  •  Broken link on WaPo FDR story. (0+ / 0-)

    Incomplete URL, far as I can see. Can you fix this? Thanks!

  •  yea well... guess these stats will improve eh? (1+ / 0-)
    Recommended by:
    Laconic Lib

    The ranks of America's poor are on track to climb to levels unseen in nearly half a century, erasing gains from the war on poverty in the 1960s amid a weak economy and fraying government safety net. The analysts' estimates suggest that some 47 million people in the U.S., or 1 in 6, were poor last year. An increase of one-tenth of a percentage point to 15.2 percent would tie the 1983 rate, the highest since 1965. The highest level on record was 22.4 percent in 1959, when the government began calculating poverty figures.

    The share of the nation's wealth held by the less affluent half (50%) of American households dropped precipitously after the financial crisis, to 1.1 percent, according to new calculations by Congress's nonpartisan research service.
    By contrast, the share of total net worth held by the wealthiest 1 percent of American households continued rising, hitting 34.5 percent in 2010. The top 10 percent's share was 74.5 percent.

    Suburban poverty, already at a record level of 11.8 percent, will increase again in 2011.
    Concretely, between 2007 and 2010, while median family wealth fell by 38.8 percent, the wealth of the Walton family (Wal-Mart heirs) members rose from $73.3 billion to $89.5 billion… In 2007, it was reported that the Walton family wealth was as large as the bottom 35 million families in the wealth distribution combined, or 30.5 percent of all American families.

    And in 2010, as the Walton’s wealth has risen and most other Americans’ wealth declined, it is now the case that the Walton family wealth is as large as the bottom 48.8 million families in the wealth distribution (constituting 41.5 percent of all American families) combined.

    Consumer credit climbed more than forecast in May, led by the biggest jump in credit-card debt in almost five years that may signal Americans are struggling to make ends meet. The $17.1 billion increase, exceeding the highest estimate of economists surveyed by Bloomberg News and the largest this year, followed a $9.95 billion gain the previous month that was more than previously estimated, the Federal Reserve said today in Washington. Revolving credit, which includes credit card spending, rose by $8 billion, the most since November 2007.

    American borrowers currently owe more than $150 billion in private student loans, according to the report. Default rates soared in the years since the financial crisis, and more than $8 billion in private loans are in default.

  •  Exactly what he did in the 2010 lame duck. (2+ / 0-)
    Recommended by:
    Ender, Buzzer

    He gives away all of his leverage so that he will be "forced" to give Repukes what they want in the debt ceiling negotiations.

    We've all seen this picture before. Some of us remember it.

  •  minority (3+ / 0-)
    Recommended by:
    Ender, DSPS owl, Laconic Lib

    I guess I'm in the minority here, I'm glad FICA was restored to its sufficient level.  Social security funding should never be put at risk -- should never be in the deficit discussion.  The Dem point should have been, if you think ss needs better funding, eliminate the income cap on withholding.  

    Apres Bush, le deluge.

    by melvynny on Tue Jan 01, 2013 at 06:05:29 AM PST

  •  Biden/??? 2016? (1+ / 0-)
    Recommended by:

    Assuming Hillary doesn't run (which her current health issues make even less likely than IMO it already was) -- seems to me the Democratic Party could do a lot worse than nominate Biden, presumably for only one term, with a VP like Antonio Villagairoso (younger, dynamic, non-WASP/white Catholic), who would then be well-positioned for 2020.

    That would provide a great continuity and transition to the deep bench of up-and-coming leaders, solidify the Hispanic vote, etc. etc.

    •  Biden is old as dirt (0+ / 0-)

      Not that it stopped Reagan from running.

    •  At 60... (0+ / 0-)

      ...John Kerry was the oldest first-time Democratic party candidate for president in at least a hundred years. Nominating Clinton, Biden, or even Mark Warner would be unprecedented. I'm not saying it won't happen, only that historically the party prefers younger candidates.

      For the record:

      Grover Cleveland, 46 in 1884
      William Jennings Bryan, 36 in 1896
      Alton B Parker, 52 in 1904
      Woodrow Wilson, 56 in 1912
      James M Cox, 50 in 1920
      John W Davis, 51 in 1924
      Al Smith, 55 in 1928
      Franklin Roosevelt, 50 in 1932
      Adlai Stevenson, 52 in 1952
      John Kennedy, 43 in 1960
      Hubert Humphrey, 57 in 1968
      George McGovern, 50 in 1972
      Jimmy Carter, 52 in 1976
      Walter Mondale, 54 in 1984
      Michael Dukakis, 55 in 1988
      Bill Clinton, 46 in 1992
      Al Gore, 52 in 2000
      John Kerry, 60 in 2004
      Barack Obama, 47 in 2008

      Harry Truman was 64 in 1948, but also an incumbent who did have to compete in a nominating process. Lyndon Johnson was 56 in 1964.

      "There is no room for injustice anywhere in the American mansion." Lyndon Johnson

      by pkgoode on Tue Jan 01, 2013 at 11:34:22 AM PST

      [ Parent ]

  •  On McManus's reassessment of his punditry (5+ / 0-)

    Pundits are not the only "experts" who refuse to look back on their work over the past few years and issue mea culpas for their errors, possibly even admitting that their ideology itself has been proven wrong.

    Paul Krugman, in an entry on his blog on December 30th titled Is Our Austerians Learning? makes the same point about the economists who have been wrong about their predictions at every turn over the past four years, some even much longer than that, but who still cling to their failed beliefs.

    But we don’t have to go to hard-liners and marginal figures to find people who refuse to learn. Basically the whole austerian movement has been wrong about everything for two and a half years — wrong about interest rates, wrong about the effects of austerity on GDP in Europe. Yet where is the reconsideration?

    And utter wrongness seems to be no disqualification for being considered a source of wisdom. It’s hard to top Alan Greenspan’s record these past seven or eight years: he went from denying that there was a housing bubble (or even that such a bubble was possible), to declaring the housing bust over in the fall of 2006, to declaring that US deficits would produce high inflation and interest rates (along with expressing his regret that it hadn’t happened yet). Yet there he was at the founding of Fix the Debt, apparently still considered the Maestro.

    So, I’ve learned some things and changed some of my views. Wouldn’t it be nice if other people would do the same, sometimes?

    "In this world of sin and sorrow there is always something to be thankful for; as for me, I rejoice that I am not a Republican." - H. L. Mencken

    by SueDe on Tue Jan 01, 2013 at 06:08:19 AM PST

  •  Status quo (2+ / 0-)
    Recommended by:
    Ender, wintergreen8694

    What has this deal accomplished? Republicans have managed to hold the country hostage over...what? Nothing. Nothing except trying to squeeze more welfare for billionaires in the form of tax cuts for the rich on the backs of the rest of us. The GOP is still shirking its constitutional duty to govern this country and at least manage to pay our bills. America will forever be broken so long as ideological extremists dominate on Capitol Hill and gerrymandered congressional districts rather than the electoral will of the majority rule our political system.  All this does is guarantee that an identical scenario will continuously play out down the road until someone stands up to these Tea Party thugs.    -  progressive

  •  This may be heresy for a liberal... (4+ / 0-)

    ...but I wish people would quit trotting FDR out to make a point. The economic catastrophe of the Depression was obviously greater than the Great Recession, but it occurred against a much less complex backdrop:

    * The country was a third the size that it is now
    * The country was 90% white (1)
    * Minority groups had few rights (none in the south) and there was no immigration issue
    * There was no transglobal economy, no military-industrial complex (there was barely a standing army), no health care complex, no high technology industry
    * Modern communications was just underway. Virtually no one had a television set, and personal computers were no more conceivable that mainframes
    * Political parties were aligned most along regional lines that served white constituencies -- coalitions could be built without complicating factors of race or sexual identity. (Don't get me wrong: I'm glad those factors exist now.)

    I won't go so far as to consign Roosevelt to history, but the conditions in which he operated were vastly different.

    (1) Latinos weren't counted separately, but they didn't have the demographic significance that they do now

    "There is no room for injustice anywhere in the American mansion." Lyndon Johnson

    by pkgoode on Tue Jan 01, 2013 at 06:41:18 AM PST

    •  What's Your Point? (1+ / 0-)
      Recommended by:

      The country's different and...?

      The economic crises the affecting the people in the country are very similar.

      If I was a communist, rich men would fear me...And the opposite applies. The history of all hitherto existing society is the history of class struggles.

      by stewarjt on Tue Jan 01, 2013 at 08:15:17 AM PST

      [ Parent ]

      •  Which is half the story (0+ / 0-)

        The political, economic, social, and diplomatic environments in which the president must operate are more complex by a degree of magnitude.

        For example, it was no problem for the New Deal to segregate or restrict employment programs to whites-only. It's a critical distinction because the overwhelmingly white electorate believed that its taxes funded programs to benefit itself. FDR never had to contend with a virulent, influential nativist faction that stoked racial resentment into an anti-government fervor.

        Manufacturing was reaching heights that peaked during WW2 and extended well into the 50s. Labor was a powerful liberal constituency and the thought of manufacturing jobs being exported to China and other countries didn't cross anyone's mind any more than the thought of China being a world economic power did.

        "There is no room for injustice anywhere in the American mansion." Lyndon Johnson

        by pkgoode on Tue Jan 01, 2013 at 11:44:00 AM PST

        [ Parent ]

  •  Now, let's close those loopholes! (2+ / 0-)
    Recommended by:
    Ender, DSPS owl

    Romney and Ryan claimed that closing loopholes would be fiscally effective and so easy they didn't even need to mention which loopholes they'd close first. It's not too late to allow them a moment of bipartisan patriotism. As chairman of the House Budget Committee, Ryan should name them and get that ball rolling.

    According to the NY Times, above

    Nonetheless, this deal is a weak brew that remains far too generous to the rich and fails to bring in enough revenue to deal with the nation’s deep need for public investments.
    It's time to ask, what would Romney/Ryan do?

    Let's go after those loopholes.

    “Social Security has nothing to do with balancing a budget or erasing or lowering the deficit.” -- Ronald Reagan, 1984 debate with Walter Mondale

    by RJDixon74135 on Tue Jan 01, 2013 at 07:02:11 AM PST

  •  I'm sick about the deal (3+ / 0-)
    Recommended by:
    Ender, stewarjt, betelgeux

    Obama sold the people who voted for him out, AGAIN.  I will never understand why he has no backbone.  He wouldn't even stand behind promises he made during the campaign and after to raise taxes on incomes above 250k.

    He is doing more harm to progressives than anything Republicans do.  

    PBO is doing a competent job, but he needs to be more liberal.

    by jimgilliamv2 on Tue Jan 01, 2013 at 07:29:29 AM PST

  •  Regular As Clockwork (1+ / 0-)
    Recommended by:

    One can always count on "liberals" like Matt Yglesias and Paul Krugman to apologize for any deal President Obama "cagily" negotiates.  Anything the president does, those two always bleat, "Well it could have been worse."  Yeah, ya know what?  It could have been a lot better.  It could have been what people voted for.

    If I was a communist, rich men would fear me...And the opposite applies. The history of all hitherto existing society is the history of class struggles.

    by stewarjt on Tue Jan 01, 2013 at 07:43:02 AM PST

  •  BREAKING: Republicans nominate 2016 candidate. (2+ / 0-)
    Recommended by:
    Ender, betelgeux

    Following the line of descent from past-his-prime Bob Dole to attack-the-wrong-country Bush to way-past-his-prime McCain to tax-cheat-liar Romney, only one person can keep the GOP on line in their effort to destroy democracy:

    Yes, Benito Mussolini !! Going for this Italian dictator (1883-1945) is their billionaires' choice and the most logical progression.

    "Me ne frego!"

    Benito gives not an inch of ground to Cosmo hunk Scott Brown. Sexiest Man of 2016 !


    Credere, obbedire, combattere !!
    (Believe, obey, fight.) Good luck with that, guys. They're also mailing out Black Shirts to a couple million NRA-loving, gun-sucking Baby Killers. Fascisti per sempre!

    "We have done nothing to be ashamed of. We have nothing to apologize for." NRA 12/14/2012

    by bontemps2012 on Tue Jan 01, 2013 at 08:10:48 AM PST

  •  From text of bill, new tax rates 10%/25% (2+ / 0-)
    Recommended by:
    stewarjt, Laconic Lib

    This is a bit interesting: "(1) a consolidation of the current 6 individual income tax brackets into not more than two brackets of 10 and not more than 25 percent;
    (2) a reduction in the corporate tax rate to not greater than 25 percent"

    "I have no special talents. I am only passionately curious." A. Einstein

    by bewert on Tue Jan 01, 2013 at 09:33:24 AM PST

Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site