Wednesday, January 16, 2013

Stopped Making Sense

Maybe it stopped making sense before this but . . .

If you remember way back in time (a couple of weeks ago), Congress agreed with President Obama's proposal to increase taxes on "millionaires and billionaires", which translated into English means if you make more than about 200K and have a net worth of less than $1 million.  You may have read that the tax increase kicks in at 400K (singles) or 450K (married) but because of new limits on the ability to take deductions the tax increases actually begin to kick in at a much lower level.

This tax increase will bring in about $60 billion a year.

Guess what?  This week, Congress just spent the first year's take!

The Sandy Relief Bill will cost $60 billion.  But it's "off-budget", so we don't need to worry about it adding to the deficit (nudge, nudge, wink, wink)!  Except it's real dollars and we'll need to borrow to afford it.

Actually, it's not all for Sandy.  Only about $26 billion is for relief from the storm.  The other $34 billion includes funds for Head Start, a new roof for the Smithsonian, support for Alaskan fisheries, and funding for future natural disasters.  If you want an insight into additional political shenanigans regarding whether Sandy is classified as a "hurricane" or a "tropical storm" and the financial implications of this classification read this post by Roger Pielke Jr.

The bill passed the House with unanimous Democratic support and 49 Republican votes.  But the real story is that the Republican leadership which runs the House could have prevented a vote on the pork-laden bill until the junk was stripped out of it.  Instead, they facilitated the amendment inserting the pork.

So here's where we stand on fiscal responsibility:

The Democrats have given up any pretense of caring.  They just talk about the rich and fairness and ignore the math.

The Republicans want to keep up the appearance of caring but when push comes to shove (and Governor Christie (R) can push quite hard) they don't really want to fight and when their local R's want the money it will flow.

Demosclerosis strikes again!

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