Arkady's Thoughts

With the deadline approaching rapidly our esteemed representatives must act quickly to decide the fate of millions of Americans that are one month away from a tax increase.  Yes, it is quite fair to call it a tax increase despite the levels returning to pre-Bush levels because Americans will be paying more in taxes come 2011.  As ABC reports the details of the compromise are as follows : extending lower Bush tax rates for EVERYONE for 2 more yrs; extending 99 weeks’ worth of unemployment insurance benefits for an additional 13 months for approximately nine million Americans – without being offset by spending cuts; one year payroll tax reduction for employees -- from 12.4% to 10.4%  ($120 billion worth). This is instead of the “Making Work Pay” tax credit in the stimulus bill – an administration officials says this will “will have more than twice the economic impact next year as a one-year extension of Making Work Pay.” It also will be more noticed than that tax cre...

One of Peter Orszag's first messages after leaving the public sector was to advise his former boss to extend the Bush cuts for two more years.  Ideally he would prefer to extend the cuts only for the middle class, but despite his liberal desires has come to a sober realization. Why does this combination make sense? The answer is that over the medium term, the tax cuts are simply not affordable. Yet no one wants to make an already stagnating jobs market worse over the next year or two, which is exactly what would happen if the cuts expire as planned. Talk about a rock and a hard place. So despite his Keynesian ways, Orszag admits that a tax increase (essentially what the expiration would amount to) would damage jobs.  His populist desires compel him to suggest we keep these cuts for the middle class only, yet he realizes  the wealthy keep this economy moving.  This is essentially a microcosm of the age-old debate between conservative and liberal thin...

The way I saw the Obama victory - well after the initial shock wore off- was that of a very strong potential to be beneficial to the conservative cause. As I have mentioned in a post-election video, approaching from a very macro viewpoint there are two major possibilities. 1) Obama drops the change/hope mantra and due to his inexperience governs without governing. Most of his policies will simply fall on deaf ears and many of this proposals will never be implemented due to a slew of factors; economy, partisanship, change of mind, etc. This will lead to massive disappointment and frustration among his loyal constituency and anger over the moderates who were looking for a change of pace. 2) Obama governs just like his campaign slogans and with the aid of the most liberal congress leadership in history implements social program galore. While these programs generally take time to decay and eat away at infrastructure and can often go unnoticed in times of prosperity, but with today's e...