Bad Repressentation
From Zanecorpwiki
Republicans have done a great job in moving the debate on deficit control. It seems most likely that there will be revenue increases through the closing of loop holes (which I'm well convinced would be a good thing) but an increase in rates, even just the top rate (or additional brackets) is very unlikely. This is unfortunate because by most historical standards, the wealthy are not paying their fair share. Especially when one considers that the wealthiest Americans have been the primary beneficiaries of growth in the 90's and 00's.
What's "strange" (meaning, it's not strange at all) is the public feels strongly that revenue should be increased in order to avoid cutting benefits. Now, there's clearly a long term problem and have stated elsewhere that leaving entitlements as is both morally wrong and fiscally irresponsible. However, I agree with the general sentiment: society's well off members can certainly afford to kick in a little more. We don't need, nor should we, start slashing benefits in the near term.
Even Republicans, overall, prefer revenue increases to spending cuts when it gets down to it. There's a class divide... wealthy Republicans are willing to give the poor the finger, but poor Republicans are not so in-sync with their leadership on this one.
I'm reluctant to believe that political strategists are all that clever so I'm going to say the Republicans stumbled on this one, but however they got there, the trick seems to revolve around focusing all the attention on "big government" and "waste" and throwing around terms like "socialism" and "irresponsible". What with all this wasteful, irresponsible, big government, we can just cut the fat?
Of course, it depends on your definition of what constitutes "fat". For conservatives making 6 figures and more, Medicare may seem like "fat", but most people find that in reality there's not near so much fat as they think. But most people don't deal with the details. They just hear about all this fat, so with that false premise in mind, the idea that "taxes aren't the problem, spending is the problem" doesn't seem so crazy.
From there, human psychology takes over and even once it's painfully clear that tax increases are necessary to sustain the key programs that the majority want to keep, there's a reluctance to admit the truth. To admit the truth would require that lots of people admit that they didn't know what they were talking about. They would have to admit that they are gullible and their leaders ignorant and/or corrupt. That's tough.
So this is what will happen: we'll get drastic cuts that go too far. The gap between the rich and the median American will continue to grow, and probably continue to grow faster and faster. At some point, that has to be corrected. My prediction is we'll lurch through a series of policy shifts until at some point Wall Street tries to take the economy hostage again like it did following the housing crisis. The Republicans (or Democrats, whoever happens to be the overt Wall Street ally at the time) won't be able to deflect the public sentiment so easily. After a decade of lost potential, billions spent on lobbying, much wailing and gnashing of teeth, we'll end up with something like Clinton era tax rates. The country will finally start to recover. The wealthy will begin the same old trope that if we'd only lower their rates, things would get even better, somehow Reagan will be credited with the recovery and we'll start the dance all over again.
See Deficit Predictions.
