The Nation of Change has published Robert Reich’s article The Next Game of Economic Chicken: Not on the Deficit But Over Taxing the Rich.
Some Democrats (and some White House strategists) figure they’ll have most bargaining leverage in next year’s deal if they do nothing now – allowing tax rates to rise automatically on everyone after the first of the year. Then they plan to offer Republicans a deal that reduces taxes on people earning less than $250,000 – which would be retroactive to January 1st.
Republicans would have to choose between a tax cut on the middle class or no tax cut at all. Democrats believe Republicans would have to take the deal. Even Grover Norquist would be hard-pressed to come up with an argument against it.
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So who blinks first? Democrats who don’t mind going over the cliff because they’ll get a better final deal – and the deal will be retroactive to January 1st so it’s not really a cliff at all but more like a little hill?
Keep that last part of the quote in mind always. The fiscal cliff is only a cliff if the scheduled changes go into effect and the Congress never does anything in the ensuing decade to fix the problem.
This idea of the fiscal cliff fits right in as part of Naomi Klein’s thesis in The Shock Doctrine.
Based on breakthrough historical research and four years of on-the-ground reporting in disaster zones, The Shock Doctrine vividly shows how disaster capitalism – the rapid-fire corporate reengineering of societies still reeling from shock – did not begin with September 11, 2001.
The wealthy, the Republicans, and the media owned by the wealthy want to scare you so badly that you will put pressure on Congress to “do something, do anything, don’t just stand there, do something!” What you should be saying to President Obama and the Democrats is, “Stand your ground. Don’t cave to the scare tactics. You have all the high cards, use them. Call their bluff. Use the shock doctrine on them for a change.”
If you read the quotes I have chosen from Robert Reich’s article you can infer that I have left out the other side of the game of chicken. Very clever of you. Now go read the article to find out what the other side is.