Nevertheless, I'm not here to bash Republicans any more than I did in the above paragraph. I'm here to look for progress, and I think I may see some. The tax issue is - for some mysterious reason - a controversial one. I get that people don't want to pay excessively high taxes. I'm one of those people. What I don't understand is how Democrats don't understand that higher taxes in a recession is a bad idea and how Republicans don't understand that tax rates will have to rise if we're actually going to close the deficit.
But maybe I'm not giving either party enough credit, because what I'm hearing through the grapevine is that Democrats and Republicans may be close to reaching the logical conclusion about the expiring Bush tax cuts. Extend them for a few years to help the economy get back on track without guaranteeing to extend them permanently.
America's primary concern should be economic recovery, not the deficit. Smart people know this even though some of them use the deficit to create a sense of fear. The deficit is a real problem, but it's not the primary problem.
Both our politicians and our populace need to keep this in mind moving forward. If we can fix the economy, the need to fix the deficit won't be as pressing, it will start to take care of itself. Unsustainable spending will still need to be cut in certain areas, but not as drastically as the fear-mongerers would have you believe.
Furthermore, extending tax cuts permanently would perhaps spur investment, but by the actual, measurable numbers, would do nothing to cut the deficit. In fact it would cost 4 trillion bucks. It's possible that investment would offset some of that cost, but there's no way to know. Similarly, it's difficult to predict how much of a dent economic recovery would put in the deficit. So both sides can claim to be right but only in a certain scenario, neither of which is certain.
The best thing to do then, is the safest. Extend tax cuts temporarily. The lost revenue from temporary cuts isn't going to destroy America and the extra purchasing power may help spur recovery. Don't make cuts permanent either, if the deficit becomes the huge problem that people want us to think it is now, we may very well need those 4 trillion dollars in a few years.
Despite all the demagoguery and bickering, it seems as though sensible people know that fixing the economy is paramount. Democrats and Republicans agree that tax cuts should be extended for everyone making under 250K. People need to have money to spend and it can't hurt to give wealthier people more money as well, maybe they'll go buy yachts, or even better, reinvest.
At the same time, this deficit that Republicans love to scare us with does need to disappear. They hypocrisy of using the budget deficit as a tool for fear while simultaneously taking steps to increase it by 4 trillion is not only wrong, it's unbelievably short-sighted. (I know I promised I wouldn't bash Republicans, but sometimes I can't help myself...it's just so easy). What if economy doesn't recover as expected but the deficit continues to grow? It's going to take more than just spending cuts to bring it under control. The permanent loss of 4 trillion dollars worth of revenue is a scary prospect when times are bleak.
And times are bleak, but I'm seeing another glimmer of hope. In the last few days, Congress has made spinach safe, now maybe they'll take an important step towards fostering economic growth without handcuffing us to future revenue loss.
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