Democratic Phantoms

President Obama and the democrats are amazingly bad at politics. They seem to not understand the GOP's successes as politicians . They also must not see how they do it:

The GOP consistently sticks to its talking points throughout their tenure in Congress. For instance, in pretty much every interview in the last few years every GOP affiliated congressmen invariably stated "tax-increases kill jobs, they've referred to owners as 'job creators,' and this government has a spending problem, not a revenue problem." They stick to their points and they never drift elsewhere because they understand that the American people can only take so much. Americans constantly hear that tax increases on the richest Americans will depress the economy and kill jobs. No facts needed in this strategy because a falsity that is said by an elite group of politicians becomes a factually unsupported truth in the minds of a disinterested segment of the public. Accordingly, the American public, as polls show, don't know very much about what is going on in this country. For example, most didn't know which party had control in each house after the 2010 elections. 

The Democratic Party, including President Obama, always get in the political game too late. They fail to persuade the public that they're position is the right one and come out at the last minute on all the news programs stating their reasons for why the other side is wrong and they genuinely look baffled at how their Republican counterparts are getting away with it. Well, the reason that they get away with it is because they do a better job at communicating to the public. Republican congressmen flood the airwaves of the networks throughout any major debate while the Democrats come out in the end to complain about the outcome. I just saw a Democrat on CNN a few minutes ago (who just recently must have found his balls) blasting the debt deal that was reached among Obama and House leaders. He even went so far as to say that he would condone Obama pleading the 14th amendment and unilaterally raise the debt ceiling. He said Dick Cheney would have done it. Where was this guy throughout the debate; he was awesome. But awesomely late as well. The Democratic congressmen are intelligent and rational and have the facts on their side, and in this debate the public as well, but they are horrible politicians. They must have an aversion to conformity because Democrats never unite until its too late. When will these Democratic politicians become politicians?

The Debt Debate and China

Republicans are being horrible politicians during this contentious and polarized debt debate. Let us be honest, they have not been willing to compromise adequately with the democrats. The Freshman Republicans claim that they were sent to Washington by the Tea Partiers to decrease the debt and put the government on track to become financially self-sufficient, i.e. spending money that we take in from revenue from American citizens. Borrowing from foreign nations, like scary China, is unacceptable to these politicians and for good reason.

But let us put this into perspective and context. China needs us just as much as we need them. There is a reason why they are willing to take in American debt and accumulate a foreign reserve surplus while we run a deficit. China needs America to export a vast amount of their products into our vibrant economy. America's economy is based on 70% consumption and China wants to be a main provider for that 70%. A problem in this dangerously dependent relationship is that if one of us decides to stop playing in this game it could be detrimental to both economies. For instance, if China were to stop buying our debt or demanded faster repayments in the form of higher interest rates it would hurt the American economy. But the point is that even though China owns a substantial amount of debt, I think it is around 8%, they don't have as much leverage as the fiscal situation implicates. An underlying reason why China's economy has been growing at 9% annually is because they began opened themselves up to foreign markets with America being their most significant client.

The China debacle explained to some extent in the previous paragraph is just to get who ever may end up reading this a different way to view our complicated relationship with China. Now, back to the debt debate. All members from both parties acknowledge the fact that increasing an already 14 trillion dollars of debt is dangerous. All congressman are attempting to mitigate our debt problem, it is just the variables that we take to do that that they disagree on.

Republicans have legitimacy behind their statement of "increasing taxes incentivizes the government to spend more." In the past, taxes have been increased as well as spending and decreasing the debt never materialized. But in the Clinton Administration, they balanced the budget while increasing some taxes and put the country on a path of domestic fiscal solvency. And Obama has been willing to decrease the debt by 4 trillion over the next ten years. Some members of Congress call his speech disingenuous. But Obama had a 4 trillion dollar plan that was rejected by Congress. Obama has held meetings daily to find a solution and has himself tied an otherwise unconnected debt ceiling with the fiscal budget. This does not have to be done, but Obama wants to chip away at our debt. He has acted as such. And please, pray that a deal gets done, and if your agnostic or atheist, call someone who is religious and ask them to pray for you. 

Easy Situation for the Democrats

President Obama is ostensibly fighting for the middle-class, but his rhetoric is consistently vague and his past results are disconcerting. For instance, Obama condemned those who wanted to extend the Bush tax cuts prior to the vote in December and continued to condemn them after they were extended. But they were nonetheless extended. And his rhetoric now seems suspiciously similar. He is still using his liberal rhetoric, saying things like:

it's also true that if we tackle our deficit with spending cuts alone, it will likely end up costing seniors and middle-class families a great deal. Retired Americans will have to pay a lot more for their health care. Students will have to pay a lot more for college. A worker who gets laid off might not have any temporary help or job training to fall back on. 

which Obama wrote today in USA TODAY. The December compromise of extending all of the Bush tax cuts did include a substantial amount of money that went towards scholarships and other governmental subsidies. However, at some point Obama and the Democrats need to take a stand against allowing the extension of tax cuts for people that make above 250 thousand dollars. Republicans have already taken their stance, which goes against popular sentiment. The Democrats now have a chance to make their case for the alternative. 

Each party has acknowledged the need to reduce the nation's deficit. The Democrats have a chance to make their case for taking a balanced approach. Paul Ryan's plan is clearly not balanced. It adversely affects the middle and poor classes of America and lowers the corporate tax rate to 25% without any mentions of eradicating specific tax loopholes or expenditures. If Paul Ryan's plan was balanced, he would have enumerated the steps with regards to his reformation of the tax code. 

It is clear that America is apart of a global economy and all economists recommend lowering the rate to 25% for us to be more competitive. However, corporations do not even come close to paying their mandated tax percentage as a collective. For example, GE not only dodged paying any taxes last year, but they managed to receive a 3.1 billion dollar tax credit. This alone proves that the tax system is clearly dysfunctional and needs to be reformed. But Paul Ryan doesn't get into any specifics about tax reform which has the potential to attract a trillion dollars in revenue if done correctly. If his plan were serious, he would have explained to the American public why reducing the code was in America's best interest and how, simultaneously, the government could attract more revenue from corporations by getting rid of an adequate amount of tax loopholes the corporations presently enjoy. Since his hasn't, he has thus proved that his plan is an unbalanced insult to Americans and now all the Democrats have to do is come out with a fair approach to solving our debt and they will come out politically successful.