The Fiscal Knoll

President Obama has moved the fiscal cliff debate back to the position that he always wanted to get to. Obama is now advocating for a "small" measure that would (1)raise taxes on only those making over $250,000, (2)put off all the spending cuts, (3)pass to so-called doc fix, and (4)grant him authority to raise the debt ceiling. The media, of course, is not bothering to analyze what this would mean; they just report Obama's new "serious" albeit temporary offer. Let's look at what this "offer" would mean.

First, taxes would go up on exactly those specified all along by Obama. We have been told that in negotiations Obama offered to change that to $400,000, but that offer is out the window. Taxes on estates would return to the level of 1999. That means that people who die owning small businesses, ranches, farms or even family homes worth over $1 million will have to pay federal estate tax at 55%. Since many states levy estate taxes of more than 10%, many of these estates will have to pay two thirds in taxes. That means that all of those family farms, ranches, and small businesses will have to be sold just to pay the taxes.

Second, nothing would be done to cut federal spending. Let me repeat that: NOTHING WOULD BE DONE TO CUT FEDERAL SPENDING!! The results of the battle waged in the Summer of 2011 to finally get some sort of spending cut would be thrown away. The expected deficit of the federal government would rise substantially.

Third, nothing would be done to improve the situation for American business. The USA would remain the country with the worst tax climate for business in the world.

Fourth, there would be no limit on the ability of Obama and his cronies to spend federal money. Before the end of his second term, the debt crisis would likely explode and destroy the American economy sending the world into a new depression.

Let's be clear: Obama's offer is not just for a bad deal. Obama's offer is a path to the destruction of the American economy. Obama's goal is to hurt the Republicans. It ought to be to help Americans. Let's hope that the House stands its ground. Our future depends on that.