J. KARL MILLER: The president should offer meaningful compromise on 2013 budget

Wednesday, December 5, 2012 | 6:00 a.m. CST; updated 9:17 p.m. CST, Monday, December 10, 2012

Along with many other serious political observers, I had hoped the president's election to a second term would enable him to junk his "I won" attitude and work to bring the nation together, rather than continue a vigorous campaign to rub the losers' noses in the dirt. We have seen enough divisiveness to last several lifetimes.

Sadly, his proposal to solve the financial crisis before the nation collectively plunges over the "fiscal cliff" is more of the same. His emissary, Treasury Secretary Timothy Geithner, delivered an offer requiring $1.6 trillion in additional tax revenue from the top 2 percent, $50 billion in additional stimulus spending, extending unemployment insurance for one year, a year of kicking the sequester down the road and using unilateral presidential authority to raise the debt ceiling.

His sole concession to the Republicans — perhaps next year, in 2014, the White House will agree to "discussions" in cutting up to $400 billion dollars in entitlement reform and maybe even take up deficit reduction. (As I recall, presidents Ronald Reagan and George H. W. Bush both were burned by Democrats' "tax now and cut spending later" promises.) If this is his idea of a balanced approach, I would not like to see his notion of a plan skewed to his advantage.

It should be abundantly clear to everyone that "to the victor belong the spoils" — the Republican bargaining position is severely weakened by the Democrats' elective gains in the House and the Senate. House Speaker John Boehner recognized this reality up front and offered serious concessions for increasing revenue.

Nevertheless, the president's position, even defined as an initial offer on the table, cannot be considered a serious proposal by any reasonable standards. And, if this is, in fact, his final word on the matter, it speaks volumes about his competence and character. He can and will blame Republicans for risking an unnecessary recession — that is little solace for those whose livelihood is endangered.

Let us, however, consider the relative strength of President Barack Obama's position today as opposed to four years ago. He had just been swept into the White House as the multicultural-hope-and-change candidate, anointed by much of the media as a modern Caesar.

He also won a second term, nearly sweeping the so-called "swing states." Nevertheless, while he still controls the bully pulpit and half the legislature, realistically, his legacy is now precarious. He was easily re-elected despite a continued sluggish economy and high unemployment — now, he will be forced to deal with reality.

All of the speechifying and celebrity testimonials notwithstanding, his initial four years in office yielded very little of substance. Family household income is down 8.1 percent since 2000 ($5,000 per household).

Also, the administration's attack on the "super rich" as being tax slackers is more than a little disingenuous. By what yardstick are those with incomes of $200,000 and $250,000 per year counted as millionaires? And by what mathematical logic should the top 1 percent of the earners who take home 17 percent of the income and pay more than 37 percent of the income taxes be taxed more?

It doesn't require extraordinary brain power to understand that a rather large number of those who pay little or no taxes are more than happy to see someone else, particularly the rich, be assessed a higher rate — they benefit through no effort of their own. But is picking the pockets of the better-off because a majority of the voters wish it so any way to run a country?

The Greeks have a word for this chicanery — ochlocracy, the interpretation of which is "mob rule."

Finally, in looking at this fiscal cliff and the consequences in failing to avoid it, do we really want to risk another recession by levying a tax increase on the top 2 percent, one that will gain but $82 billion in revenue against a daily government spending of $10.46 billion per day? That $82 billion in revenue would run the nation for about a week and would not reduce the deficit by one dime.

When one considers ending the "Bush tax cuts," it must be remembered that they included tax relief for all who paid taxes. I have no doubt the U.S. could recover from a return to the Clinton-era taxation; however, it would be a painful and traumatic experience, particularly for the middle class who suffer the most during a recession.

The reality this president must face is that the economy is now his and his alone. He held the reins for four years, two of them with a congressional majority and has always been blessed with at least one house of Congress. The "honeymoon" he enjoyed by blaming his predecessor is no longer available to him. Four years down the road, no one will remember George W. Bush — success or failure will belong to President Obama. 

This fiscal divide can and should be closed, but it will require meaningful tax and entitlement reform. Both parties must put ideologies on hold and fix that which is most important. The Republicans' "no tax increases" are hardly more unreasonable or idiotic than the Democrats' "entitlement programs are off the table."

Mr. President, for the sake of the country and for your legacy, it is time to lead. You won the majority of votes for the second time. Accordingly, you can afford a measure of humility and take the time, as did presidents Reagan and Clinton, to sit down with the congressional leadership to arrive at a solution.

Voting "present" is not an option.

J. Karl Miller retired as a colonel in the Marine Corps. He is a Columbia resident and can be reached via email at Questions? Contact Opinion editor Elizabeth Conner.

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Christopher Foote December 5, 2012 | 10:53 a.m.

Here is a graph illustrating how in the last 30 years the vast majority of economic growth has benefited those at the top:
As a consequence of this accumulation of wealth those at the top of the income distribution pay a larger share of the taxes. It takes a special kind of sophist to opine that since the wealthy have amassed a larger share of the economic gains over the past 30 years it would be unjust to suggest that they pay a slightly higher tax rate. Even though this would be the same tax rate that was in place during the Clinton boom when the federal budget was roughly balanced (actually their rates would be slightly lower as they would still enjoy the middle class cuts that the President wants to maintain).
Note that the same sophist thought it also unjust and an example of "class war-fare" to suggest that Mitt Romney's tax rate of 14% on roughly $10 million per annum, was too low.
In essence what Mr. Miller and his fellow Republicans are arguing is that the wealthy should be taxed at a historically low rate and to address the widening deficit that this will generate due to lower federal revenues, we should cut spending on programs that predominately benefit the poor and working class, whose wages have stagnated for over a decade. The recent election was a referendum on this very issue, and Mitt Romney and his pro regressive taxation policies were soundly defeated.
Lastly, the reaction to Mr. Obama's proposal exposes the hypocrisy of the deficit scolds (they don't really care about the deficit ) see 2001-2007 for reference, as well as Boehner's non-plan that falls far short of Obama's in reducing the deficit.

(Report Comment)
Michael Williams December 5, 2012 | 1:52 p.m.

Chris: A couple of points......

(1) Soundly defeated? At the President and Senate, 'tis true. But I would remind you that the House remains in "other" hands. You say the last election was a "referendum"; given that only the House can initiate spending bills, how do you interpret that particular part of the "referendum" regarding guardianship of spending? I'd say part of your "referendum" does NOT include giving Obama all he asks for. This isn't a dictatorship just because the President won. You can't pick-and-choose what you consider a "referendum".
(2) Add back Romney's charitable contributions and recalculate. We did that once before in this place, but perhaps you didn't see it, forgot it, or ignored it. I don't know which. Taxes are paid on AGI, not total income...and you know that, or at least should.

(3) It's true that the wealthy should pay a greater percentage; I actually agree with this. However, I fight you on the notion for two reasons: (a) You will eventually get to me since "enough" is not in your lexicon, and (b) I'm firmly convinced your goal is NOT equal's equal outcome.

So, I prefer that you not get your camel's nose under the wealthy tent, because you'll eventually be sitting in my lap. I much prefer a conservative government setting the tax rates, not progressives.

PS: As a sidebar, the State of Missouri recently had a "referendum", also.....a House and Senate that is VETO-proof. Since you wish the "referendums" to rule, I fully expect you to shut up and acquiesce to ALL bills coming out of our State Congress. No griping allowed.

Or are "referendums" defined only by you?

(Report Comment)
Michael Williams December 5, 2012 | 2:05 p.m.

Oh, by the way, folks discuss 39.5% fed tax (or thereabouts)...up from 36% (or thereabouts) as the proverbial drop in the bucket.

Well, let's do some calculating: There's fed tax (39.5%), there's state tax (in MO, 6%...higher elsewhere), there's use taxes, business taxes, sales taxes and...I could go on.

Now add.

Damn close to 50%!!!!!!!!!!

Now, tell me, all you would YOU feel about working for 50 cents on the dollar?

Personally, I say (and said) "To hell with that!"

PS: Prove to me that taxing the wealthy at the proposed rates solves our budget problems as seems to be the President's case. Or does this just solve your "envy" problem?

(Report Comment)
Michael Williams December 5, 2012 | 2:17 p.m.

I have never seen words that so aptly described my perception of "progressive" thought and intent:

From Detroit City Council member JoAnn Watson:

"Our people in an overwhelming way supported the re-election of this president and there ought to be a quid pro quo and you ought to exercise leadership on that. Of course, not just that, but why not?

After the election of Jimmy Carter, the honorable Coleman Alexander Young, he went to Washington, D.C. He came home with some bacon," said Watson. "That's what you do."

Pathetic. "Our" people?

I've got it bookmarked. I'm sure you'll see it again as a reminder when the opportunity presents itself.

(Report Comment)
Michael Williams December 5, 2012 | 2:22 p.m.

ochlocracy, the interpretation of which is "mob rule."

I like "ineptocracy" better: A system of government where the least capable to lead are elected by the least capable of producing, and where members of society least likely to sustain themselves are rewarded with goods and services paid for by the confiscated wealth of a diminishing number of producers.

Yeah, that dog hunts.

(Report Comment)
J Karl Miller December 5, 2012 | 6:22 p.m.

Mr Foote,

You seem to forget that the wealthy do pay a higher rate and also pay more than the lion's share of the taxes. For example, the top ten percent of the earners pay 70 percent of the taxes. Additionally, the pitifully minute increase in revenue--perhaps 82 billion dollars per year--will not and is not intended to be used to pay down the debt.

Also, those entitlement programs you and your Democrat colleagues refuse even to consider reining in have to be paid for--this President's borrowing and spending binge to the tune of 1.5 trillion dollars per annum cannot even be compared with the proverbial drunken sailor. You see, that sailor stops spending when he runs out of money..

(Report Comment)
Skip Yates December 5, 2012 | 7:06 p.m.

The parasites are slowly killing the host.

(Report Comment)
Michael Williams December 5, 2012 | 8:32 p.m.

SkipY: The trick is to not be an ebola virus which kills with near certainty.

A far better strategy is to harm and take resources, but not a really bad sinus infection. With such an approach, you get to go on and continue the infection with later generations.

It's a biological thingie.

(Report Comment)
Skip Yates December 6, 2012 | 9:34 a.m.

MichaelW: Roger, that!

(Report Comment)

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