Soapbox Philosophy: Cuts need to come first on fiscal cliff Op-Ed · December 14, 2012
When U.S. Rep. Dave Loebsack on Saturday visited Razor Edge, West Branch resident Clarence Crew pulled out his wallet. The leather billfold is held together with rubber bands on either side, and he said he wants a new one. A good one. An American-made one.
He found some he likes, but they cost $49 to $99. That’s OK, though.
“I’d rather not eat for a couple of days to know that (the wallet I purchased) is made in America,” he said.
Crew, a friend of Razor Edge business owners Gary and Sue Faith, and Loebsack chatted about the economy, which soon turned to Congress and the “fiscal cliff.” While that financial problem is not unique to West Branch, I was very interested in this topic and I’d even prepared some questions on it.
“We’ve got to work down the aisle,” the World War II Navy veteran told Loebsack.
The congressman agreed.
“I’ve heard that from hard-core Republicans as well as Democrats,” Loebsack said.
Right now, Loebsack and most of the House members are back in their home states while House Speaker John Boehner and President Obama negotiate.
Loebsack said small businesses like Razor Edge should be just as concerned as anyone about the fiscal cliff, which could raise taxes on both families and businesses, because of the certainty of what will happen if it is not addressed, and the uncertainty of the overall effect on the U.S. economy.
Loebsack said he wants to keep things “where they are” for the middle class and income earners. He also wants to exclude small business and family farms and tax increases. He predicts there will be a mix of spending cuts and new taxes, though he shook his head when asked if he had any idea which would be greater.
I’m glad to hear that there would be a mix of both revenues and cuts, but I was not happy by what he revealed next: That Boehner and Obama would likely “deal with the tax side first,” which would then provide the starting place for spending cuts.
That sounds like a political way to get started. It seems that the statesman’s way would be to do cuts first and set the goal to minimize tax increases as much possible. This approach sounds like they are trying to see how many tax increases they can stomach before they consider cuts.
“The overwhelming majority (of Congress) is not part of the discussion,” Loebsack said, though he sent a letter to both sides, urging them to meet daily.
Loebsack suggests setting the estate tax at 35 percent for anything higher than $5 million and keeping capital gains and dividends taxes at the same for the next year.
I thought back to Clarence’s wallet.
If tax increases are considered first, he may not have much need for those rubber bands.
There will be hardly anything left to hold inside.