Since the Senate passed its 157-page fiscal cliff monstrosity this morning by a vote of 89-8, it is practically a done deal that the House will do likewise today or before noon Wednesday.
Much was made of the fact income taxes will be going up only for those couples earning more than $450,000. Little was noted about the fact that every wage earner will take a 2 percent haircut because the payroll tax holiday was allowed to expire — $125 billion a year sucked right out of the private sector. And the 5-point hike in the capital gains tax was ignored by many media sources, as was the increase in the death tax rate. The revenues from all of those will be less than projected.
The bill extends unemployment benefits ($30 billion in deficit spending), doesn’t cut Medicare payments to doctors ($25 billion in deficit spending), even the wind energy production tax credit is extended a year ($12 billion in deficit spending). The costs of all of those will be greater than projected.
The Senate bill puts off addressing any spending cuts for two months.
Never mind that the nation hit the debt ceiling yesterday and the Treasury Department plans to skirt this with accounting tricks.
With this kind of “deal,” jobs will be lost and recession is nearly assured.
But hardly anyone is talking about the biggest tax of all that is looming like a dark storm cloud: Inflation — the most recessive tax hike of all, the one that hits the poorest the hardest but also hits everyone. We can’t continue to print money and expect it to hold its value.
The CBO says the bill adds $4 trillion to the deficit: American Taxpayer Relief Act