Crisis averted, sort of...

As you have certainly heard by now, the debt ceiling was raised on Tuesday, avoiding a potentially catastrophic situation.  Talking heads across the country have been giving their thoughts, and depending on which side of the aisle you are on, the deal was either really good or really bad.  I'm far from a pundit, or a talking head, but I've got a few thoughts on the "deal".  Here goes...

First of all, to call it a deal means that each side at the negotiating table got something they wanted, while having to give up something else they may have wanted.  With that in mind, this was NOT a deal.  Sure, President Obama won't have to go through another debt ceiling debate in his first term (assuming he gets re-elected), but to quote Speaker of the House John Boehner, "I'm pretty happy" because he got "98 percent of what he wanted" in the legislation.  In short, one side of the debate getting 98% of what it wanted seems to be about as far away from a compromise as possible, especially considering how far apart the two sides were in the negotiations. 

In other words, Democrats lost in this deal, and that would be due to President Obama completely caving in and allowing the Tea Party to dictate what would happen.  As a Democrat, this whole process sickened me.  Do we spend too much money?  You bet.  Do we bring in too little revenue?  Sure thing.  There is absolutely wasteful spending going on in Washington, but to sit here and say we only have a spending problem is absolutely untrue.  The one example that has come up a lot lately is that of General Electric.  They made $14.2 billion in profits in 2010, yet they received a $3.2 billion tax credit!  If you find nothing wrong with this picture, I don't even want to talk to you.  You are so wrong I don't even want to waste my time arguing with you.  Look, I'm not one to punish success.  However, there is no reason that me and my puny salary should have to pay taxes every year and GE, a giant corporation making billions of dollars walks away with a fat check from the government.  That is a giant problem!

Now, I know what some of you are thinking, that I want to punish success.  Not true, not even a little.  Truth is, I hope to make $14.2 billion in profits someday, and when that happens, I would fully expect to pay taxes on that profit, not get a check.  Asking those that make $250,000 and above to pay their fair share is not a lot to ask.  Again, I know what you are going to say.  The top 20% are already paying the bulk of the total tax burden while the bottom 40% pay little to no taxes.  I've heard that line from so many people over the past few weeks.  First of all, that is a complete lie.  Second of all, poor people pay less in taxes than rich people, as they should, but it's very far from zero.  Low incomes account for many that pay little to no taxes.  Senior citizens receiving SSI don't pay taxes because it is exempt from federal taxes.  Plus, the tax code provides benefits to low income earners with children (child tax credit, earned income tax credit).  Also, to say that Joe, who works at McDonalds for minimum wage, bringing home $15,000 a year should be paying more in taxes is just insane.  Joe can barely feed himself, let alone pay for housing, feed a family and pay for reliable transportation.  Meanwhile, Johnny Hedge Fund Manager is bringing home $500 million a year, and is able to pay just a small portion of that money due to loopholes.  Johnny HFM is certainly paying a higher amount than Joe, but paying more would impact him much less. 

Anyway, while I think that the Democrats lost this battle, the real loser in all of this is the American people.  We took this one on the chin.  We may have avoided a default, which would have hurt us even worse, but the cuts that have been agreed upon are going to hurt average, every day Americans like you and me.  Add to that the loss of faith we have in our elected officials, and the fact that they are really only concerned about their next election, not doing right by us, and we came out on the losing end, big time.  Good news is, in just a few months, the new Super Congress will start the next argument of what will get cut next, all while refusing to include any revenue in the argument.  Maybe Canada isn't looking so bad after all.  I'm just saying...