Due to an ongoing health crisis in the family, blogging will be 'on and off' as time and circumstances permit for the foreseeable future. I also beg your indulgence if I am slow in responding to emails. New posts will appear below this notice.

Thursday, June 23, 2011

Budget talks near collapse as GOP leader quits

House Majority Leader Eric Cantor pulled out of debt-reduction talks with the White House on Thursday, saying the effort has reached an impasse over taxes that can be resolved only by President Obama and House Speaker John A. Boehner (R-Ohio).

In a statement, Cantor (R-Va.) said he remains optimistic about the talks, led by Vice President Biden, which have “identified trillions in spending cuts” and “established a blueprint that could institute the fiscal reforms needed to start getting our fiscal house in order.”

However, a three-hour bargaining session Wednesday was highly contentious and failed to make headway, as Democrats pressed repeatedly for Republicans to accept provisions to raise taxes, according to participants in the talks.
Read the rest here.


Ps-Iosifson said...

It's not that the talks are near collapse, it's that Cantor is passing the buck so Boehner gets tarred with tax compromise thus allowing Cantor to retain his Tea Party street cred. That is, Cantor's going to make Boehner fall on his sword and do the right thing so he doesn't have to. It's internal Republican hardball because they all know revenue has to be increased, but they also know their base doesn't know that and doesn't care and will lynch anyone that raises taxes.

John (Ad Orientem) said...

That's an interesting theory and one that I think is credible. Thanks for posting.

Ben said...

I'm sorry. I lean towards the right on so many issues, but at this point, being 24 myself, I see the need for us citizens to take a little bit of a hit on taxes because otherwise I will not only see a cent of the social security that I have been paying into since I was 16 (and most likely will until the end of my earthly life), but I will not be living in the United States of America. It's time for people to stop complaining about how hard higher taxes are (we're spoiled really) and look around to see that we have OUT OF CONTROL inflation, which will only get worse if we don't find another source of government income other and the Fed continuing to give away free money.

Cayo Joe said...

It's always interesting to me, although somewhat morbidly, that people keep coming back to "higher taxes" (or "revenue enhancements" in the liberal argot) as the solution to these repeated economic crises around the globe. Few seem to see that the problem isn't one of too little in taxation but rather one of spending too much. Far too much. The inescapable math is that we could tax everyone and everything at 100% and not meet the revenue requirements for the government programs on the books today... like Ben's SSI.

A return to free-market principles and self-reliance with the concomitant devolution of the government Nanny State would solve the deficit/debt crises. What's more, these underfunded and essentially bankrupt programs have been morphed over the decades into something they were never intended to be. E.g., Social Security was intended to be a supplement (hence its title "Supplemental Security Income") for those who beat the average life expectancy and outlived their savings. Fairly applied, no one would get a penny of SSI today until age 78.7!

Lastly, the path to prosperity isn't through higher taxes (or thinking that we're spoiled in the U.S. because our tax rates are lower than in other socialist countries). Prosperity will flow from lower taxes and less government interference in our lives and markets. Lowering taxes (we have the highest corporate tax rate in the world, btw) has always had the effect of actually increasing revenue to government whereas tax increases (or "revenue enhancements" as the libs put it these days) has the opposite effect.

The Anti-Gnostic said...

There is simply not enough 'more' tax revenue. Go above one-third marginal rates and you really start hitting diminishing returns with capital flight and tax evasion. The rich will just move their wealth overseas. The working poor will just claim disability.

You hear a lot of talk about 50 - 90% marginal rates but the truth is nobody paid them. There were numerous shelters, deductions, deferred comp, untaxed benefits, etc.