"Fiscal Cliff" Scam: Represents Federal Spending Increasing Less, Increased Gov't Power Video

Anything the Republicans and Democrats agree to will be worse than the ” fiscal cliff ” in terms of tax increases.

Sometime before January 1, some gargantuan bill will be forced through to avert the phony disaster. It will contain larger increases to both federal spending and taxes than the fiscal cliff represents, along with the additional pork needed to get the holdout votes.

There will likely be further loss of basic liberties buried in it somewhere as well. And leaders from both parties will wave it around in triumph as a “bipartisan solution.”

The so-called “fiscal cliff” represents nothing more than a return to policies proven far less dysfunctional than the current ones, but Washington doesn’t see it that way. Instead they want you to beg them to save you from this horrific monster and adore them when they double down on policies that serve to increase your dependency on them.

The phrase “fiscal cliff” refers to a dire economic situation that the
United States will face at the end of 2012. It is Ben Bernanke’s – the
Federal Reserve Chairman – infamous description of the budget
realities made before Congress early in 2012.

Here’s a question:  If I give you 50¢ and as a result of that transaction, you owe me $1.00, what interest rate have I charged you?  Obviously, I’ve charged you 100% interest and I don’t give a rat’s ass about you or your kids.  I’m pure evil and you’re pure stupid.  But believe it or not, this kind of master-slave  arrangement isn’t enough to satisfy a true narcissist.   The narcissist needs to be exalted for his actions, no matter how unjust. 

He likes to be thought of as “accommodative.”

    In 2011, every dollar of GDP growth created $2.08 in debt.  In real life, that’s 108% interest plus the nominal rate, and our twisted leaders want you to say, “Thank you sir, may I have another!”

     2011 wasn’t an anomaly either; it’s the new normal. The rise in debt has exceeded the rise in GDP 6 of the last 10 years (the four years of positive GDP-minus-Debt can be directly attributed to the housing bubble).  That never happened in the U.S. during Great Depression/WWII era. 

    One place where it did happen was in the Weimar Republic (which shortly thereafter became known as Nazi Germany) .  No one’s ever done a better job of explaining how quickly things unraveled there than Art Cashin (this is an absolute MUST read):

In 1920, a loaf of bread soared to $1.20, and then in 1921 it hit $1.35. By the middle of 1922 it was $3.50. At the start of 1923 it rocketed to $700 a loaf. Five months later a loaf went for $1200. By September it was $2 million. A month later it was $670 million (wide spread rioting broke out). The next month it hit $3 billion. By mid month it was $100 billion. Then it all collapsed.

 ….In 1913, the total currency of Germany was a grand total of 6 billion marks. In November of 1923 that loaf of bread we just talked about cost 428 billion marks.

The ‘fiscal cliff’

What is it?

* A package of tax increases and spending and program cuts set to take effect Jan. 1, unless Congress approves a budget deal to prevent the hikes and cuts. Economists say the tax increases would be the steepest in the country in 60 years when measured as a percentage of the economy. Economists expect such tax hikes to reduce consumer spending and program hikes to result in a barrage of job losses, thus crippling the American economy.

 Why is it happening?

Economic experts say there are many contributing factors. Among them:

* The U.S. government has run annual budget deficits in excess of $1 trillion in each of the last four fiscal years since Obama Took office.. A recent report showed the government started the 2013 budget year with a $120 billion deficit in October, suggesting a fifth $1 trillion annual deficit is likely.

* More than 50 percent of the tax increases would come from the expiration of tax cuts approved in 2001 and 2003 and from additional tax cuts in a 2009 economic stimulus law. About 20 percent of those tax increases would come from the expiration of a Social Security tax cut enacted in 2010. The change would cost someone making $50,000 about $1,000 a year, or nearly $20 a week, and a household with two high-paid workers up to $4,500, or nearly $87 a week.

* Another 20 percent of the tax increase would come from the end of about 80 tax breaks, mostly for businesses. One is a tax credit for research and development. Another lets companies deduct from their income half the cost of large equipment or machinery.

* The rest of the tax increase would come mainly from the alternative minimum tax, designed to prevent rich people from exploiting loopholes and deductions to avoid any income tax. The AMT wasn’t indexed for inflation, so it’s increasingly threatened middle-income taxpayers.

* Another part of the cliff is an expected package of spending cuts in areas of national defense, highway funding, aid to state and local governments and health research, education grants, FBI and other law enforcement, environmental protection and more, according to the White House.

The fiscal cliff is entirely a manufactured threat.

The same people who are now negotiating worked two years ago to create the mess which they say is such a threat.

At any point they wanted to, the President and the Congress could reduce the “cliff” to a series of foothills by breaking the problem into ten or twenty component parts.

They could then focus on solving each problem on its own merits and out in the open with public hearings, public understanding and public involvement.

Public understanding, however, would limit the level of waste, favoritism, and special interests which could be funded.

That is exactly the opposite of what the Washington establishment wants.

But Would Going Off the ‘Fiscal Cliff’ Be So Bad?

 Now, some might argue that any tax increase during tough economic times is harmful. Therein lies the rub. This whole phony crisis is about exactly that: raising taxes. With an approval rating at subterranean levels, the government wants the people to support tax hikes while continuing the gravy train for government employees and special interests.

When will Americans ever learn?

Two separate paths are possible here One sinks the country into
unavoidable recession and involves raising the debt ceiling again,
slowdown of 4% in the gross domestic product during 2013, rise in
unemployment and the loss of 2 million jobs.

The second scenario The “Fiscal Cliff”
stabilizes the economy over time, but stings initially.

The fiscal cliff the nation faces isn’t any different than the fiscal cliff we all face in our own financial lives if we break the LAWS of money.

Our fiscal cliff was the result of irresponsible government spending
and continuous borrowing from other countries to support that
spending

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