Washington Gridlock Explained

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Compromise does not work in Washington, as demonstrated by this man, John Boehner

If the fiscal cliff debates have taught me anything, it’s that John Boehner is fucked. Republicans and Democrats mostly want the same things:

  1. Kick the defense budget debate into 2013 and end automatic cuts
  2. Kick other government spending cuts into 2013 as well, avoid cuts to government workers
  3. Permanently adjust the Alternative Minimum Tax rules so inflation is always accounted
  4. Raise government revenue

It is item number 4 that is the big problem. Both sides are OK with reducing tax reductions (like charities) for all Americans, which is speculated to raise between $400-800 billion over 10 years. The difference is Democrats want to raise additional revenue on those who make more than $250,000 a year, and Republicans don’t want to raise any additional revenue from taxpayers. Here is where things get really funny.

John Boehner created a fallback plan, “Plan B” where he will allow tax increases for those who make more than $1 million a year. Obama and almost all Democrats denounced this plan and said they would not pass it. Boehner, insistent on this compromise went ahead and tried to pass it in the House, as kind of a political theater to show there was interest in this bill. The only problem, Republicans didn’t want this either! Tax increases on those who make more than $1 million won’t fly past Republicans.

Additional to this clusterfuck, Obama has compromised and agreed to increase the income from $250,000 to $400,000, which the Republicans obviously denounced because it is an increase on taxes for citizens. However, Democrats are complaining that Obama pledged that taxes should go up on incomes greater than $250,000 – not $400,000. So Obama’s party is pissed that he’s breaking a campaign pledge. Now Obama has to fear that his own party will not be willing to pass this legislation, since it is not what he promised.

Ultimately, there will have to be compromise. Obama has the least to lose really – he’s already been elected to the last 4 years of his political career. Boehner is fucked though. His willingness to compromise on taxes is going to kill him in his party. To get a bill passed, he and a few other Republicans will have to give in on tax revenue to while getting the Democrat minority in the House to pass the bill. Democrats will ultimately compromise on Obama’s compromise, because backing the President is the best thing for their party. Democrats have the most to gain if we go over the cliff, because if there is not compromise, then taxes are increased for ALL incomes – which means Republicans have a lot to lose if there is no compromise. The big question is if a few key Republicans are willing to swallow their pride and raise rates for the minority of citizens, so the majority can keep their current tax rates.