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Sunday, December 04, 2011

$1 from the 1%

The Republican field of candidates for President has been called a "clown car" and it's easy to see why. They're crazy. Each and every candidate has fatal flaws. I wouldn't be surprised if the Republican National Convention becomes a media circus, dragging out beyond scheduled adjournment, with a brokered outcome and a surprise nominee coming out of nowhere.

Republicans have also painted themselves into a corner by opposing tax increases. The U.S. Constitution gives Congress the power to raise taxes. Members of Congress pledge to uphold the Constitution. But Republicans have signed the Grover Norquist pledge against any tax increases.

Taxes can be an important tool, not just to raise revenue, but also to keep inflation under control. When the 99% gets money, it spends a lot of it on needs. When the 1% gets money, it puts a lot of it in the stock market. Does an undertaxed Wall Street fuel inflation? Food prices are going up. With the right incentives, perhaps we could shift our priorities from financial products to food products.

Democrats might be able to get the upper hand by proposing a tax revenue increase of $1 from the 1%. It would really show independents how inflexible the Republicans are. The idea becomes dangerous, however, if Democrats propose deeper and deeper cuts and if Republican suddenly take them up on it. Obama has already put Social Security and Medicare on the table. They're called entitlements for a reason. We really are entitled to them.

However, given that Republicans are locked into the Norquist pledge, it is almost certain they would not agree, even to a hike of $1. Democrats would be turning the other cheek, and Republicans would be striking it.


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