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The inside line from Washington is that there will be no Fiscal Cliff deal before the end of the year.That’s not surprising. Unfortunately, it always seemed unlikely that our politicians would agree to any vote that could be framed as them having voted to “raise taxes” — which any deal before December 31 could have been framed as.
The more likely scenario seemed to be that politicians would wait until taxes increased automatically on January 1 and then heroically vote to cut them — at least some of them.
And that’s still my bet about what will happen in January.
But just because it seemed likely that politicians would be ruled by “politics” instead of pragmatism doesn’t mean this is something to be proud of.
And let’s be clear about what has happened in the past two months.
What has happened is that the political party that has based its entire existence on never agreeing to a tax hike of any kind has essentially agreed to tax hike for the entire country.
By not accepting the Democrats’ offer to extend the Bush tax cuts for ~98% of Americans, the Republicans have agreed to let taxes rise on ALL Americans.
The Republicans have done this, it appears, only (or at least mainly) in a stubborn attempt to preserve lower tax rates on the highest-earning Americans.
And now those tax rates, too, will go up.
And the economy will slow down.
The Republicans have tried to pin the blame for the tax hikes on the Democrats, but most Americans have seen through this. And rightly so. The Republicans agreed to the coming tax hikes when they voted for the legislation in the summer of 2011. And now, by refusing to extend the tax cuts for all Americans but the richest 2%, the Republicans have tacitly once again agreed to raise taxes on all Americans.
This is what happens when a party that used to be known for pragmatism and responsibility allows itself to be hijacked by ideologues.
A deal to mute the impact of the Fiscal Cliff and raise the debt ceiling should be within easy reach of reasonable people on both sides of the aisle.
Unfortunately, our government isn’t run by reasonable people anymore. Especially on the Republican side.
NOTE: This is my personal view, not “Business Insider’s” So if you want to lecture someone about how the Republicans are absolutely right to agree to raise taxes on the entire country just to avoid voting to increase taxes on the highest-earning Americans, please direct those notes to me.
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