On 2012-11-15, at 3:00 PM, raghu wrote:
> On Thu, Nov 15, 2012 at 12:48 PM, Max Sawicky <[email protected]> wrote:
> > Bullhocky. If he does that virtually every leftish group will cry foul.
> > Will not happen.
>
> Oh, it will happen. Something like this has been in the cards for a very long
> time. Obama will get a nominal tax rate hike on the millionaires to 39%, but
> he will leave untouched the real scandal - the estate tax and the capital
> gains rate.
>
> This whole debate has been like a bad kabuki theater. Obama has been making a
> very big deal out of this really weak thing, so he will get it and then use
> it as a cover to cut entitlements.
>
> The only question is what he will cut. As Max says, Medicare spending cuts,
> if done right can actually be worth doing. But it looks more likely that
> cruel changes like increases in eligibility age is what Obama really prefers.
> We will find out soon if he will get away with it, whether he really is the
> More Effective Evil.
Obama's post election comments have already left the door open to keeping the
Bush tax rates in place in exchange for closing unspecified tax loopholes which
would ostensibly compensate for the revenue shortfall. This is the tax
concession favoured by the Republicans.
As for resistance to the spending cuts, left liberals, who are already unhappy
and mistrustful of this administration, will undoubtedly "cry foul", but
whether they will go beyond further expressions of dismay is highly doubtful
given their long history of pulling back for fear of giving aid and comfort to
the Republicans.
I'll be surprised if there the same vicious frontal assault on union rights and
social benefits as in Europe. There is not the same need, as the standards of
US workers are already lower in both areas. The European capitalists are
looking to adopt the American social model. Lower US pension benefits are
likely to phased in and the retirement age raised without affecting retirees
and those nearing retirement ("grandfathering"). Meanwhile, retirement is a
long way off for young workers, and they are unlikely to go to the barricades
if the retirement age, an abstraction to them at this point, is raised by a
couple of years. They will grumble about higher contributions, though. The
poor, who are the least likely to organize, are likely to bear the brunt of
cutbacks to social spending, although everyone will continue to be affected by
America's crumbling infrastructure and public services.
One measure I haven't heard mooted lately is the introduction of a value added
or goods and services tax, much favoured by capitalists worldwide as an
alternative to corporate and personal income taxes. I suppose that is because
the Republicans fear they would face a revolt from by moronic white working
class tea party supporters, who have been conditioned to chant "no new taxes"
of any kind.
The real issue facing the administration, it seems to me, is the economic
recovery. Continued modest growth and job creation will help blunt any
potential resistance to the cuts to social programs. However the global
economy is still very fragile, and if the crisis deepens and joblessness begins
to approach European levels, it can't at all be ruled out that many activists
and workers in the DP, spurred on in this case by the entitlement rollbacks,
will march and organize and even, mirable dictu, begin to look for alternatives
to the DP.
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