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Boehner Proposes Conditional Tax Hike On High Earners, Obama Refuses

Tyler Durden's picture


The Fiscal Cliff cat and mouse game is entering its last two weeks of calendar 2012, with Congress now officially closed for the year. And while we would have expected major updates in the Cliff timeline to only hit during trading hours, usually just as AAPL once again threatens to trade with a 4-handle, Reuters reports that out of the blue Boehner, who last we checked is back in Ohio, has made a radical departure with the Norquist pledge status quo, and has offered to raise tax rates on high earners to break the "fiscal cliff" deadlock in exchange for major cuts in entitlement programs, "but President Barack Obama is not ready to accept, a source said late Saturday."

Which brings us back to political square zero, because at the end of the day none of this is about a fiscally sustainable America, and certainly won't be until one day the shadow banking mechanism, whereby PDs can extract par cash from custodians for TSYs just issued and purchased and immediately re-pledged, and use said cash to recycle TSYs as effectively infinite collateral, and where more issuance means more demand (which creates a Giffen good perpetual engine which of course works, until suddenly out of the blue, for whatever reason sentiment shifts rapidly and violently, and it no longer does), fails and yields spiral out of control.

In the meantime, both political parties will trundle along pretending a tax hike which covers about a month (max) of government spending is even remotely relevant.

More from Reuters:

While the White House considers Boehner's offer "progress," the source said more remained to be worked out between the two.


Tax rates are a major sticking point in negotiations to avert steep automatic tax hikes and budget cuts set for the end of the year if a deal isn't reached. Republicans have resisted Obama's demand to extend lower tax rates for everyone except top earners, preferring to extend them for all taxpayers.


The Boehner offer was the first departure from the position the House speaker has held for months.

The question now is whether the GOP can now spin the president's
negative response to the proposed "compromise" - and it will certainly try - to portray Obama,
instead of themselves, as the entity that wants to push the US over the
cliff in exchange for political brownie points. Because now Boehner will have all the leverage to tell any splinter GOP group in either the Congress or the Senate, that he made a good will offer, and it was the president who refused.

As for the actual cliff, we repeat what we said back on November 13: "once again, it will be up to the market, just like last August, just like October of 2008, to implode and to shock Congress into awakening and coming up with a compromise of sorts. Only this time, now that Bernanke has shown he will "get to work" at a moment's notice, the impetus to do anything as a result of even a market plunge will be far less. After all why lose face, and put your career in jeopardy when there is the Fed which, supposedly, can offset a market crash, courtesy of the shining example set by Chuck Schumer."

Nothing has changed since then.


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Sat, 12/15/2012 - 23:25 | 3067844 overhere2000
overhere2000's picture

Shame Boehner is not a leader, he is being steamrolled by his own party.

Sat, 12/15/2012 - 23:30 | 3067856 Cash2Riches
Cash2Riches's picture

They will play this game of cat and mouse right down to the wire, for show. The MOPE continues. QE to infinity is here to stay until it all blows apart.


Five Gold & Silver Mistakes.

Sat, 12/15/2012 - 23:33 | 3067866 HedgeAccordingly
HedgeAccordingly's picture

we are down to the wire..... imo 

Sat, 12/15/2012 - 23:59 | 3067912 Raymond K Hessel
Raymond K Hessel's picture

I must be missing something.  

Congress set up the fiscal cliff which means tax rates go up and spending goes down if they don't come to some agreement on a budget.  


They are not in agreement because one side doesn't want rates to up and the other side won't tolerate spending cuts.


Am I crazy or is the cliff the goal?  Either side gets to look strong, resolute while getting to the ultimate goal: tax rate and spending cuts increases! 

Sun, 12/16/2012 - 00:25 | 3067951 brettd
brettd's picture

Boehner's a pussy.

Why do a deal that has less cuts than he now has?

Lousy negotiator. 

Needs to go repeatedly in public ask Obummer for cuts.

No cuts, no deal.

Like every family in the USA, the Govt needs to DO MORE WITH LESS!



Sun, 12/16/2012 - 01:33 | 3068087 DoChenRollingBearing
DoChenRollingBearing's picture

The Fiscal Cliff is discussed again by Barron's writing team, and it looks like the R-Team is going to lose...  The Cover Story is their "Outlook 2013", where 10 "Wall Street Top Strategists" discuss prospects for the coming year.  S&P 500 up 10%???

Review of Barron's -- Dated 17 December 2012

Sun, 12/16/2012 - 02:21 | 3068154 LetThemEatRand
LetThemEatRand's picture

Neither team is going to "lose."  They both work for the same 400 people who own more wealth than 1/2 of the entire country combined.  The two teams and their captive media are engaged in a false debate about who should "pay" for the trillions skimmed off the top (commonly referred to as the "national debt") by those same 400 for the last hundred years.  News flash -- the 400 are not included in either equation.  Those individuals do not "earn" money that is taxable as income.  They could care less how much some guy who makes $500K a year or $1.5M a year or $25k/year actually working or owning a business or living off a pension will be required to pay now that the jig is up.  They know that most people (e.g., you) believe that the poor and middle class and upper-middle class should one day "pay back" the debts incurred on their behalf to fund the already acquired wealth of the very few.  Congratulations.  You've been had.

Sun, 12/16/2012 - 02:27 | 3068164 flacon
flacon's picture

I'm going to be in Jon Corzine's State over Christmas..... God save me! He's still in jail though, right?

Sun, 12/16/2012 - 03:38 | 3068223 savagegoose
savagegoose's picture


Sun, 12/16/2012 - 11:46 | 3068534 redpill
redpill's picture

August 15, 1971.  Or December 23, 1913 if you want to get old school.

Sun, 12/16/2012 - 12:41 | 3068668 Theosebes Goodfellow
Theosebes Goodfellow's picture

Just droll, Redpill, simply droll. Love it.

Sun, 12/16/2012 - 13:48 | 3068818 Fredo Corleone
Fredo Corleone's picture

...Let us not omit the Fiat Era from the grand chronology: we suggest 22 September, 1985.

Sun, 12/16/2012 - 15:28 | 3069000 MiltonFriedmans...
MiltonFriedmansNightmare's picture

I'm old school. That Dec 23date lives in infamy.

Sun, 12/16/2012 - 21:42 | 3069834 Midas
Midas's picture

Yeah, Merry F'n Christmas from Jekyll Island.

Sun, 12/16/2012 - 15:35 | 3069008 QQQBall
QQQBall's picture

State of DENIAL?

Sun, 12/16/2012 - 06:53 | 3068303 Non Passaran
Non Passaran's picture

Well, genius, if it wasn't for the fake capitalist system, it woukn' be that way.
And I sure can tell free shit handouts are real money which isn't going to the top 400.

The negos are sure a farce. The public and media love it: their democratically elected reps working hard and overtime, day in day out. Splendid!

Tax code should be simplified - no exceptions, deductions and loopholes.
It won't happen. It's all fucked.

Sun, 12/16/2012 - 10:28 | 3068418 mtomato2
mtomato2's picture

Merry Christmas, LTER.  Don't know if you celebrate or not, but there it is.  Excellent post, IMHO.

Sun, 12/16/2012 - 10:51 | 3068452 max2205
max2205's picture

We have not had a budget in 4 years. What makes anyone think we will get a deal that magically produces one in 2 hours before the last two tires depart the Clift at 100 miles per hour.

Sun, 12/16/2012 - 17:58 | 3069319 bugfixx
bugfixx's picture

Why do these clowns in Congress and the White House deserve more tax revenues when they can't even pass a budget for 3+ years? When taxes go up in 2013, they still won't pass a budget and they'll spend 3x any tax revenue increase.

Sun, 12/16/2012 - 13:14 | 3068737 Dingleberry
Dingleberry's picture

Excellent post Rand. 

How come the average Joe can spot a horrible "B" movie when they go to the theater, but cannot for the life of them spot horribly-acted political drama?

Sun, 12/16/2012 - 11:32 | 3068509 azusgm
azusgm's picture

Boehner needs to take his useless, confused, statist self to a microphone and say that these talks should be going on in the House of Representatives, not the White House. Then he should go get into the Speaker's chair and gavel the place into session. If those turkeys miss the turkey and dressing, so be it.

Sun, 12/16/2012 - 03:31 | 3068217 blunderdog
blunderdog's picture

"Politics is the entertainment branch of the military-industrial complex."  -FZ

Yes, most of the time we go to the movies even though we already know how it's going to turn out.  It's still kinda fun, I guess.

Sun, 12/16/2012 - 11:29 | 3068461 Race Car Driver
Race Car Driver's picture

> They are not in agreement because one side doesn't want rates to up and the other side won't tolerate spending cuts.


It's so simple, even a Kindergartener can understand it:

John Boehner could eat no fat
Barry could eat no lean
And so betwixt the two of them
They licked the platter clean

John ate all the lean,
Barry ate all the fat.
The bone (of contention) they picked clean,
Then gave it to the cat.

John Boehner was wheeling,
Barry by the ditch.
The barrow turned over,
And in he did pitch.

Says John, “He’ll be drowned!”
But Barry did not reply,
“I don’t think I shall,
for the ditch is quite dry. Let's Party!”

Sat, 12/15/2012 - 23:32 | 3067861 Beam Me Up Scotty
Beam Me Up Scotty's picture

Ya, he should compromise right? For the good of the country?? Well, we've comrpomised ourselves right into a 16+ trillion dollar debt.

Sat, 12/15/2012 - 23:33 | 3067868 vast-dom
vast-dom's picture

i did not vote for these assholes to raise taxes. nor did i vote for them to go on illegal military adventurism escapades. nor did i vote for them to rig the markets. nor did i vote for them to spend billions campaigning. i did not vote for this.

Sat, 12/15/2012 - 23:55 | 3067905 Mr. Magoo
Mr. Magoo's picture

When everyone comes to the realization that your votes no longer matter we will be better off. There will NEVER be anther fair election until a drastic change occurs but at this point it looks like change for the worse

Sun, 12/16/2012 - 00:38 | 3067979 AldousHuxley
AldousHuxley's picture

people used to support the church with 10% tax while they built the elaborate cathedrals in Europe because they believed that prayers mattered.


people believed in government with 10-45% tax while they built massive buildings because they believed that voting mattered


people believed in capitalism with management fees by banks while banks built the highest high rises because they believed that they could beat the market and the bankers

Sun, 12/16/2012 - 01:05 | 3068035 Mr. Magoo
Mr. Magoo's picture

Either way we are all screwed in the end

Sun, 12/16/2012 - 02:44 | 3068173 LetThemEatRand
LetThemEatRand's picture

Except the few hundred (or few thousand) individuals with a net worth above several hundred million who already got theirs.  They will go on engaging in "I own the biggest ship" wars, and buying islands and such.  You know the old saying about the devil's greatest trick?   The slightly more nuanced version is, "the devil's greatest trick was convincing the masses that his wealth was earned and that taking it away from him would be a violation of the law [that his purchased politicians wrote]."

Every King and Queen (and devil) who has ever existed will tell you that the masses are just jealous and engaging in class warfare.   With a few exceptions, the wealthiest individuals in the world inherited their wealth.  In the law, children are sometimes called "produce." Perhaps that is the true meaning of the "productive class."  

Sun, 12/16/2012 - 03:43 | 3068227 Beam Me Up Scotty
Beam Me Up Scotty's picture

So why are we talking about raising taxes
On couples who only make $250k/yr again?? Because they live lavish lifestyles like Warren Buffet?

Sun, 12/16/2012 - 08:47 | 3068337 nmewn
nmewn's picture

"So why are we talking about raising taxes on couples who only make $250k/yr again??

Because raising taxes on just millionaires & billionaires won't get government even close to the "projected" 60-70 billion PER YEAR...its all been a lie...eagerly lapped up by retards.

"Because they live lavish lifestyles like Warren Buffet?"

That's right. And government should steadily decrease the threshold for inheritance taxes until the point that their house, in that quiet little cul-de-sac, is is auctioned off just to pay for the parents death, regardless of poor little Tiny Tim on crutches, the government has a program for him.

And God bless us, everyone ;-) 

Sun, 12/16/2012 - 09:03 | 3068347 tickhound
tickhound's picture

Bingo!!!! Ding ding ding!!! 

Damn, I agreed with you completely.  You're not mad at me, right?

Sun, 12/16/2012 - 09:24 | 3068359 nmewn
nmewn's picture

Of course not ;-)

Sun, 12/16/2012 - 13:11 | 3068730 AldousHuxley
AldousHuxley's picture

Republicans use upper middle class to Argue for lower taxes As much as democrats use the poor to redistribute.

As long as capital gains taxes are lower than total income tax , rich will get richer.

Sun, 12/16/2012 - 11:52 | 3068544 Lednbrass
Lednbrass's picture

Yep, its the beginning of the redefinition game of what constitutes the wealthy.

It will start with the evil 1%, then the evil 2%, then those 5% ers will look prettry well off so they should be cut down a bit also. Once that is done, well why should anyone in the top 10% mind paying a fair share- and just who do those 25% ers think they are anyway?

Sun, 12/16/2012 - 18:04 | 3069329 bugfixx
bugfixx's picture

The coming waves of price inflation and tax bracket creep will take care of that.

Sun, 12/16/2012 - 18:09 | 3069334 GMadScientist
GMadScientist's picture

Because differential taxation of capital gains and repatriation of foreign multinational dollars isn't redefining anything?!

If you're only talking about "The 1%", then you are, by definition, missing two entire pies.


Sun, 12/16/2012 - 15:38 | 3069014 MiltonFriedmans...
MiltonFriedmansNightmare's picture

Most families earning 250kK/yr are struggling to survive just like the Obamaphone Mama, the main difference being employment. Their struggle is enhanced by a few more creature comforts, but it's still a struggle nonetheless.

Sun, 12/16/2012 - 15:37 | 3069015 MiltonFriedmans...
MiltonFriedmansNightmare's picture

Most families earning 250kK/yr are struggling to survive just like the Obamaphone Mama, the main difference being employment. Their struggle is enhanced by a few more creature comforts, but it's still a struggle nonetheless.

Sat, 12/15/2012 - 23:52 | 3067899 Mr. Magoo
Mr. Magoo's picture

You are about 100 trillions short, but no matter that debt will never be paid

Sun, 12/16/2012 - 07:25 | 3068315 onewayticket2
onewayticket2's picture

the inept republican "leadership" have yet to clearly articulate (thanks, in large part, to their statist enemies in the press) that they, too, are in favor of raising revenues to the federal government...THROUGH GLOBAL COMPETITIVENESS AND GROWTH (not via rate increases which will ultimately slow down growth and revenue to the govt).

this is 101 level stuff and the fact that the R side of the aisle cant even get out of the gates to debate the premise tells me.....we're doomed. 

We're all Collectivists now.

Sun, 12/16/2012 - 12:31 | 3068642 Al Huxley
Al Huxley's picture

Diggin' that red-blue koolaid, huh?

Sun, 12/16/2012 - 18:13 | 3069343 GMadScientist
GMadScientist's picture

Enjoy your snooze.

What part of "bomb iran" fits with "global competitiveness"?

What part of repatriating the proceeds of off-shored jobs is "global growth"?

Your pablum has been Repugnican't fodder for the herd animals for decades, but they've never believed a word, sucker.

You deserve to be fleeced for being an ignorant fuck.

Sat, 12/15/2012 - 23:33 | 3067863 HedgeAccordingly
HedgeAccordingly's picture

progress is progress at this point.. he may be a moron.. but with the momo stock of the gods on the verge of a 100 point drop..

the timing could not be better.... 

Sun, 12/16/2012 - 00:11 | 3067925 zhandax
zhandax's picture

Not my job to train these idiots.  A dozen comments in and grilling dinner is starting to look far more appealing.

Sun, 12/16/2012 - 00:56 | 3068014 10mm
10mm's picture

His own party?It's the same party.

Sun, 12/16/2012 - 08:36 | 3068328 slaughterer
slaughterer's picture

Just a remark about the writing style of this the-most-complex Tyler above: "until one day the shadow banking mechanism, whereby PDs can extract par cash from custodians for TSYs just issued and purchased and immediately re-pledged, and use said cash to recycle TSYs as effectively infinite collateral, and where more issuance means more demand (which creates a Giffen good perpetual engine which of course works, until suddenly out of the blue, for whatever reason sentiment shifts rapidly and violently, and it no longer does), fails and yields spiral out of control"  

Any Economic Ph.D students with a minor in post-modern literature willing to simplify this sentence for us mere mortals?

Sun, 12/16/2012 - 10:18 | 3068409 fonzannoon
fonzannoon's picture

it means we passed through the event horizon already and when the first entity cashes in it's chips the avalance that is coming will bury everyone. thats what santelli has been saying. funny...."we think in a year or two people will start selling treasuries as rates begin to rise". Yup lets all wait until right before the music stops. no thanks. 

Sun, 12/16/2012 - 10:39 | 3068431 centerline
centerline's picture

I don't meet any of those requirements by a long shot... but, will give it a crack for the fun of it...

A recursive mechanism (loop) where profits are skimmed off the cycling of the taxpayers dollars (debt) through the Treasury via the PD's, enabled by the FED.  Because it is recursive, the law of dimishing returns applies.  Thus, it requires more and more issuance (exponentially) in order to meet the demand for yield.

Makes the debt ceiling look more like a debt target.  lol.

Sun, 12/16/2012 - 12:07 | 3068581 VisualCSharp
VisualCSharp's picture

Digressions, ahoy!

Sun, 12/16/2012 - 18:18 | 3069351 GMadScientist
GMadScientist's picture

Those with access to the discount window can front-run the Fed for a seemingly infinite duration, but this duration will turn out to be rather finite after all.


Sun, 12/16/2012 - 09:38 | 3068368 Dangertime
Dangertime's picture

It's all about keeping the "frame".

Boehner's line in the sand should be the Debt Ceiling.  Raise the taxes as Obama wants, but then refuse to raise the debt celing.  The economy will still implode and then the Democrats can be blamed.


If Obama refuses that deal, then Boehner must continually speak about how it is more important to Obama to put the country further into debt than it is to provide tax breaks to the middle class.  And then Obama has no choice but to cave.


Sun, 12/16/2012 - 18:19 | 3069356 GMadScientist
GMadScientist's picture

You think Boner can still win; that's fucking adorable.

Sun, 12/16/2012 - 11:11 | 3068475 Freedomtosayno
Freedomtosayno's picture

He is the (Establishment) Party!

Sat, 12/15/2012 - 23:28 | 3067845 Insideher Trading
Insideher Trading's picture

I am eager and willing to pay for the birth control, food stamps, and housing of others.

I am patriot. You should be too citizen.

Sat, 12/15/2012 - 23:32 | 3067865 jeff montanye
jeff montanye's picture

i am not entirely sure about the food and housing, but i am utterly, totally, completely ready to pay my share of the costs for all the birth control and abortions anyone wants, anywhere in the world. biggest bang for the buck there is, in so many ways.

Sun, 12/16/2012 - 00:07 | 3067924 Insideher Trading
Insideher Trading's picture

Are you on board with paying for the treatment of venereal diseases?

Nevermind, you're now responsible for all of the above anyway.

Sun, 12/16/2012 - 00:18 | 3067938 zhandax
zhandax's picture


Sun, 12/16/2012 - 03:37 | 3068222 blunderdog
blunderdog's picture

I'm really not so excited that I'll soon be paying more to a bunch of richer folks than me so they can continue being old. 

I'm sure they all deserve it, they paid for the older folks when they were younger, too, but they're going to be bitching about ME if I end up on foodstamps, so it seems fair enough.

Sun, 12/16/2012 - 18:23 | 3069367 GMadScientist
GMadScientist's picture

No, you're a pre-existing condition.

Sun, 12/16/2012 - 00:27 | 3067952 brettd
brettd's picture

Ah, the beauty and joy of eugenics.


Sun, 12/16/2012 - 10:08 | 3068398 nmewn
nmewn's picture

They step in without giving it a second thought...until the door slams behind them.

Then it's wait a minute, I only agreed to someone else having to die. The guard looking through the portal say's yes, you are the someone else.

(Click, fade to black)

Sun, 12/16/2012 - 18:25 | 3069374 GMadScientist
GMadScientist's picture

(fade in on accountant at health insurance company desk)

And that's our 10k, sir, and here's the high-level one for you and the board with the profits outlined as requested.

It's been a really good year!

Sun, 12/16/2012 - 01:43 | 3068111 hawk nation
hawk nation's picture

wouldn't it be cheaper to wait untill after the baby is born and then put a bullet in its head. You would get more bang for the buck that way

Sun, 12/16/2012 - 12:07 | 3068579 Bollixed
Bollixed's picture

Ah, the children. What about the children...Let's do the right thing for the children. It's all about the children...

But god help that little bastard if he smokes a joint at thirteen...

Sat, 12/15/2012 - 23:26 | 3067850 lolmao500
lolmao500's picture


Boehner is a hack. Obama is a hack.

The deficit needs to get to 0 or at least be reduced to 300-400 billion TODAY with BY LAW deficit 0 in 2014. Anything else is BS.

Sat, 12/15/2012 - 23:56 | 3067908 Matt
Matt's picture

Somehow, I doubt being a hack is an impeachable offense.

Sun, 12/16/2012 - 01:34 | 3068092 lolmao500
lolmao500's picture

Well the other shills in congress can vote against the fucker in the next congress session when they choose the speaker.

Sun, 12/16/2012 - 02:10 | 3068147 JLee2027
JLee2027's picture

While I totally agree the budget deficit should be zero, INTRADE estimates a 70% chance of Washington DC being burned to the ground by angry entitlers if that happens.

Sun, 12/16/2012 - 10:41 | 3068435 centerline
centerline's picture

Along with most other major cities.

Sun, 12/16/2012 - 12:08 | 3068569 LawsofPhysics
LawsofPhysics's picture

Yes, the Military Industrialists do feel very entitled to your wallet and they do have the capabilities to burn many cities to the ground in a flash.  So yes, you are correct, they will be very upset if they don't keep their trillion dollar budgets.  Poor folks won't do shit, aside from starve and die. 

The laws of Nature and physics really don't give a shit either way but all economies are local and most locals know who the truly evil fuckers are, so be very careful what you wish for.

Sun, 12/16/2012 - 11:49 | 3068540 azusgm
azusgm's picture

Being a hack might be an impeachable offense under "high crimes and misdemeanors".

Worth a try.

Sun, 12/16/2012 - 15:47 | 3069030 MiltonFriedmans...
MiltonFriedmansNightmare's picture

I don't think any offense is considered impeachable in this world of ours with ethics on par with those of Gotham City.

Sun, 12/16/2012 - 03:52 | 3068233 CrashisOptimistic
CrashisOptimistic's picture


CNBC's version of resolution of the fiscal cliff would be something like this:

No tax increases.  No spending cuts,  And maybe another 100 billion in stimulus spending, borrowed from Ben.

That's "resolution".

They truly still have not figured out that ANYTHING done, any compromise that reduces the impact of what is coming, will be a reduction of destimulus, leaving at least some destimulus on a GDP that will probably log in for Q4 about 1%.  The only thing being discussed is how to reduce the contractive effect.  There was a half hearted WH request for stimulus, but it would have been less than the high income tax increase so the package would have been destimulative.

They have not quite figured this out.  All roads lead to stimulus withdrawl.

Sat, 12/15/2012 - 23:41 | 3067859 jeff montanye
jeff montanye's picture

one must wonder at the high irony of the press for austerity in the teeth of a deflationary depression, austerity which was paid lip service if that in any but clinton's administration.  not that i am a fan of slick willie, but the surpluses are supposed to be accumulated in the times of plenty, not the times of famine (cf. bronze age princes; grain reserves). 

Sun, 12/16/2012 - 12:12 | 3068591 JR
JR's picture

The late Hans F. Sennholz, emeritus professor of economics and influential free-market economist, in late 2000 explained the Clinton Surplus Hoax:

In defense of their position and income, most politicians are ever eager to take as much money as possible from taxpayers so that they may buy the favors of the voters. They wax eloquent about the great benefits of spending but fall silent about the costs and consequences of taxation. Most of them may even engage in the art of fiscal legerdemain which turns a tax into a benefit and a deficit into a surplus. The budget surpluses of the Clinton Administration are current examples of such deception.

A budget reflects a president's aspirations and hopes, his wishful thinking as well as his philosophy of politics. It's a mixture of financial planning and political campaigning in which fiscal legerdemain knows no limitations of party or time. The federal budget surpluses since 1998 are no exception to the rule. They obscure significant federal expenditures through bookkeeping gimmickry, such as borrowing new money to pay off old loans and calling it "debt reduction."

Imagine a corporation suffering losses and being deep in debt. In order to boost its stock prices and the bonuses of its officers, the corporation quietly borrows funds in the bond market and uses them not only to cover its losses but also to retire some corporate stock and thereby bid up its price. And imagine the management boasting of profits and surpluses. But that's what the Clinton Administration has been doing with alacrity and brazenness. It suffers sizeable budget deficits, increasing the national debt by hundreds of billions of dollars, but uses trust funds to meet expenditures and then boasts of surpluses which excites the spending predilection of politicians in both parties. …

The surplus deception is clearly discernible in the statistics of national debt. While the spenders are boasting about surpluses, the national debt is rising year after year. In 1998, the first year of the legerdemain surplus, it rose from $5.413 trillion to $5.526 trillion, due to a deficit of $112.9 billion. Since then it has risen to $5.643 trillion today, October 15, 2000, with another deficit of $117 billion.

The federal government spends Social Security money and other trust funds which constitute obligations to present and future recipients. It consumes them and thereby incurs obligations as binding as those to the owners of savings bonds. Yet, the Treasury treats them as revenue and hails them for generating surpluses. If a private banker were to treat trust fund deposits as income and profit, he would face criminal charges.

In the coming years, the trust fund surpluses are estimated to grow significantly, inviting ever more fiscal legerdemain….

Sat, 12/15/2012 - 23:35 | 3067871 A Lunatic
A Lunatic's picture

I want a divorce.

Sun, 12/16/2012 - 06:01 | 3068290 vato poco
vato poco's picture

Oh, sure, you say you 'want a divorce'. Fuck, the whole damn country said they wanted divorces before the election. Congressional approval ratings were hovering around 10% or so - an all-time low, indicative of the enormous contempt the country felt for congress and the senate. Then along came election day.

Turns out it was all bullshit: the 2012 incumbent re-election % was.....drum roll please.....90 fucking per cent. (and that was actually *down* from the historical norm of 95% or so) If y'all ever wondered why they laugh at us; why they take less and less bother every year to disguise the fact they're shitting all over us _and having a wonderful time doing might wanna consider that stat.

Sun, 12/16/2012 - 09:23 | 3068357 azusgm
azusgm's picture

If you aren't loving things the way they are, get involved on the local level and raise up some candidates that you do want in office. Get on the phone, attend city council and political meetings, and go eyeball to eyeball with other people. Eventually, you have to put your shoes on and go sit on an uncomfortable chair and listen up then speak up. You have to interact face to face.

Sun, 12/16/2012 - 11:20 | 3068492 WillyGroper
WillyGroper's picture


Sun, 12/16/2012 - 11:51 | 3068542 azusgm
azusgm's picture

No, not ALEC. Just a person who is waking up and seeing work to be done.

Sun, 12/16/2012 - 12:32 | 3068643 A Lunatic
A Lunatic's picture

My local level is all good, it's the mother fuckers at the top that are destroying the country.........

Sun, 12/16/2012 - 11:33 | 3068512 jerry_theking_lawler
jerry_theking_lawler's picture

this is strictly because people understand and are embracing the true meaning of Republic.....they 'like' they congress-critters, just not the congress-critters of other states, therefore low approval rating of congress.

deep down, people crave the true is TPTB that are forcing us together on all ideals via the Federal system.

Sun, 12/16/2012 - 15:52 | 3069040 MiltonFriedmans...
MiltonFriedmansNightmare's picture

That's deep thinking, Vato. The human mind is quite the paradox.

Sun, 12/16/2012 - 18:17 | 3069348 bugfixx
bugfixx's picture

The majority of American voters like things just the way they are. They do NOT supporting cutting federal spending (even spending where the federal gov't has no constitutional role) and the only tax increases they favor are the ones that someone else has to pay (i.e, "the rich"). We are all drinking each other's bathwater on this site if we think that the majority supports living within our means.

Sat, 12/15/2012 - 23:36 | 3067874 lolmao500
lolmao500's picture

In other news, the sickos are at it again :

Connecticut school shooting: Westboro Baptist Church planning to picket

Less than 48 hours after the Connecticut school shooting at the Sandy Hook Elementary School in Newtown, CT, which took place on Dec. 14, the Westboro Baptist Church is already making plans to picket. The Westboro Baptist Church is known for picketing and protesting at funerals across the country.

Westboro will picket Sandy Hook Elementary School to sing praise to God for the glory of his work in executing his judgment,Shirley Phelps-Roper tweeted on Dec. 15.

Can a bunch of them get shot already??

Sat, 12/15/2012 - 23:39 | 3067878 A Lunatic
A Lunatic's picture

Un.. fucking.. believable......

Sat, 12/15/2012 - 23:47 | 3067888 Freddie
Freddie's picture

Are they really a Baptist church?  I think they are liberal activist pretending to be a church to make churches look bad.  They a one way ticket to the resurrection.

Sun, 12/16/2012 - 00:01 | 3067915 lolmao500
lolmao500's picture

Or they are a gov operation to put restrictions on freedom of speech.

Sun, 12/16/2012 - 01:15 | 3068052 Renewable Life
Renewable Life's picture

Are you that fucking dilusional about religion or just completely ignorant, that you think these fucking wackos are a "liberal group" posing as a church!!!!

I'll bet you think the Taliban is a liberal group posing as a religion too, right? The fucking nazis considered themselves Nationalist Socialist Christians, and the extermination of the Jews, was a religious policy of christian reconciliation for the murder of Jesus Christ! Read your fucking history on the Catholic Church in WWII before you get you prayer beads out tonight! And the Protestants.........American slavery and the mass murder of millions of Native Americans and Africans was justified with the use of the King James Bible. How about the Irish and English tiff, 100% religious murder for ohhhhh about 1000 years! The Crusades, the inquisitions, the colonization of Africa, China, India, and America all done by "missionaries", 9-11, Bin Laden, I could go for fucking days!

These fucking wackos can't be anything BUT religious, to be doing what they are doing!!! Congratulations, you just said the single stupidist fucking thing I've read on ZH!

Sun, 12/16/2012 - 03:39 | 3068224 blunderdog
blunderdog's picture

You let Freddie get to you?  Come on, man.  Chin up.  He's a PERL script.

Sun, 12/16/2012 - 12:47 | 3068678 JR
JR's picture

There’s not a drop of religion in this picketing of funerals.  And their purpose is clear: it brought you out of your shell to blast a sincere, sacred belief of the centuries. Their protest brought out that endless diatribe focusing on and against Christianity, the founding principle of man’s escape from bondage and tyranny, not to mention the establishment of the most free, most important Western nation -- the United States.

It is not impossible to imagine this protest group to be a part of the campaign against morality and Christianity since their actions, carried in the media, certainly add to the Left’s agenda as outlined by Karl Marx and Frederick Engels:

  1. Abolition of property in land and application of all rents of land to public purposes.
  2. A heavy progressive or graduated income tax.
  3. Abolition of all right of inheritance.
  4. Confiscation of the property of all emigrants and rebels.
  5. Centralisation of credit in the hands of the State, by means of a national bank with State capital and an exclusive monopoly.
  6. Centralisation of the means of communication and transport in the hands of the State.
  7. Extension of factories and instruments of production owned by the State; the bringing into cultivation of waste-lands, and the improvement of the soil generally in accordance with a common plan.
  8. Equal liability of all to labour. Establishment of industrial armies, especially for agriculture.
  9. Combination of agriculture with manufacturing industries; gradual abolition of the distinction between town and country, by a more equitable distribution of the population over the country.
  10. Free education for all children in public schools. Abolition of children's factory labour in its present form and combination of education with industrial production.

That is America’s fiscal cliff, now being negotiated in Washington DC in conjunction with the banker-controlled media.

Sat, 12/15/2012 - 23:59 | 3067914 Mr. Magoo
Mr. Magoo's picture

Dont worry, they will be first in line on the railcar for FEMA region 7

Sun, 12/16/2012 - 02:16 | 3068156 freedogger
freedogger's picture

Westboro - as evil as the fucker that pulled the trigger.

Sun, 12/16/2012 - 02:27 | 3068166 MyBrothersKeeper
MyBrothersKeeper's picture

If it was my kid and they showed up, they would regret doing so

Sat, 12/15/2012 - 23:37 | 3067875 tradewithdave
tradewithdave's picture

Do you think Bill Gates Dad is angry because he's cut out of his son's Last Will and Testament or something?  If you think he's upset, imagine the kids trying to get by on $4 m.



Sat, 12/15/2012 - 23:39 | 3067877 NoDebt
NoDebt's picture

You could always express your dissatisfaction on a T-shirt.

Have you notices all the T-shirt advertisement on this site?  What's up with that?  Every damned ad on the sidebars is for a T-shirt company (all the ads look suspiciously similar despite the different company names, too).  Not that I don't appreciate the big-breasted hotties in the ads, but I'm starting to wonder if ZH isn't just a clever front for somebody's budding T-shirt empire.

I'm starting to think seriously about buying one of those "I pooped today!" T-shirts.  Might be the only thing I can point to on a daily basis and honestly say "I built that."


Sat, 12/15/2012 - 23:48 | 3067889 jeff montanye
jeff montanye's picture

personally the big breasts are as nothing compared to the little spot of daylight north of the place where the short shorts or thighs touch each other.  what is the word for that tiny glimpse of paradise?

love that you built it.  you, archer daniels midland and the u.s. department of agriculture.

gave you an up arrow.

Sun, 12/16/2012 - 12:15 | 3068597 VisualCSharp
VisualCSharp's picture

The gap. :)

Sat, 12/15/2012 - 23:55 | 3067904 Matt
Matt's picture

The ads are based on your browsing history.

Sun, 12/16/2012 - 01:39 | 3068102 yabyum
yabyum's picture

Every post surgical nurse in the world should be given that shirt on a comp.

Sun, 12/16/2012 - 03:40 | 3068225 savagegoose
savagegoose's picture

u think you have it bad all i get is tranny  dating services. i gotta stop my dad using my PC.

Sun, 12/16/2012 - 08:18 | 3068325 tradewithdave
tradewithdave's picture

You didn't build that.  Archer Daniels Midland, Cargill and Monsanto built that (using Koch Brothers Haber Bosch nitrogen of course).  Obviously you're not watching enough of the Sunday morning talk show commercials. 

You can sign the "please tax me bro" pledge with Warren Buffett, George Soros and a guy who is a cat owner if you click on the link.  I'm pretty sure you get a t-shirt that says "One billionaire's self-made myth is another mom's worst nightmare" with a picture of a screaming one year old baby trying to break out of a crib.

Sun, 12/16/2012 - 08:29 | 3068327 tradewithdave
tradewithdave's picture

I think some of the t-shirt designs are a bit too subtle.  There's another t-shirt that is about balancing the budget.  It shows Erskine Bowles holding a taser pointed at octogenarian Alan Simpson.  It says "Please taze me bro". How to privatize social security and beat austerity with a doctor's note

Do you think people really get that?  It's a little esoteric, but maybe not for the ZHers.  It's under the "Cliff T-Shirts" category. 

Sat, 12/15/2012 - 23:45 | 3067882 Yen Cross
Yen Cross's picture

 Yellow Boy , got a new liver! The ghost of Larry Hagman is calling /

  Both Houses of legislation are so full of bile, it makes me sick!

Sat, 12/15/2012 - 23:58 | 3067895 Old Poor Richard
Old Poor Richard's picture

Boehner's a traitor willing to cave on taxes--proposing $800 billion in new tax revenue first, and now also proposing explicit tax hikes.  And he's a hater on the needy, trying to cut entitlements.  NOBODY needs this SOB.  We need to freeze the debt ceiling, yet SOB Boehner has purged conservative Republicans who voted against raising the ceiling last time.

Shut it all down!

Here's my plan: Turn over responsibility for all non-discretionary spending (handouts) to the states.  Require a surplus federal budget and cap revenue, thereby capping spending.  Once the national debt is paid off, cut revenue further and require a balanced budget.




Sun, 12/16/2012 - 01:19 | 3068060 Atomizer
Atomizer's picture

You need to keep your lips sealed. You have proven to be the cat that shits inside it's own mouth. How can this Government attempt to carry out fraud & deceptiveness, if you keep disclosing significant spoilers?


Sun, 12/16/2012 - 10:51 | 3068450 Old Poor Richard
Old Poor Richard's picture

Glass Jaw Boner is begging Obummer for the chance to take a dive, but wants to pose like he's putting up a good fight.  Obummer says fuck you, you go down hard in the first or I hold you on the ropes to just keep hurting you.

Boner's a traitor to conservatives, to America, to Republicans, to everybody. 

You can be damned sure the little bitch will try to force through gun control next, after he's raised our taxes.  House Repubs need to deny him the speaker position or we're doomed.  Gun control might be the real reason he's terminating the Tea Party, not just debt ceiling.



Sun, 12/16/2012 - 12:02 | 3068557 azusgm
azusgm's picture

It's not just Boehner in the House. I think Cornyn in the Senate probably "helped" Jim DeMint resign. The RNC is the Establishment and they are conducting a purge. They control people like Cornyn and Boehner. The only way to take out the RNC is from within the Republican party. The Republican party is target-rich with puppets who can be thrown out if the true conservatives will get busy inside the party and lay some groundwork for 2014.

Ted Cruz's election proves the point.

Sun, 12/16/2012 - 18:24 | 3069369 bugfixx
bugfixx's picture

The majority will never vote for that. They want more free sh1t, not balanced budgets.

Sat, 12/15/2012 - 23:55 | 3067903 Yen Cross
Yen Cross's picture

 This deal is ( stillborn) The cliff will be crossed, and I will make shitload of ( PAPER)

Sun, 12/16/2012 - 01:20 | 3068063 Atomizer
Atomizer's picture


Sun, 12/16/2012 - 09:42 | 3068374 overmedicatedun...
overmedicatedundersexed's picture

have the gop elite and bonerrrrr..bought enough puts or calls that's the only info I want, which is it PUTS OR CALLS?

Sat, 12/15/2012 - 23:59 | 3067911 ekm
ekm's picture

I read this somewhere I don't remember:


If normal people do something really really dumb openly and in public, they do it on purpose.

Sun, 12/16/2012 - 00:04 | 3067920 Yen Cross
Yen Cross's picture

EKM I just got back into the States. You kick ass! Those endless (primary dealer) comments, aka OIS swaps comments are beautiful! :-)

Sun, 12/16/2012 - 00:35 | 3067975 ekm
ekm's picture

Can you expand more details?

I just looked up the OIS swaps and I don't see any connection.

Teach me please

Sun, 12/16/2012 - 01:28 | 3068004 Yen Cross
Yen Cross's picture

Central Banks lend to each other at (set) rates over a pre-determined time frame.

 ECB lends 40 yards of ëuros" @ 1.30 to the fed @ 10 basis points at ( handling cost 10 basis points) after 30 days.

  The 40 yards is insulated from currency fluctuations until the expiration date. The contract is executed on the predetermined date 30 days prior/

    Bitchez This is the biggest shell game ever played!   Can we please discuss (OIS markets, and how they relate to Swaps)?

   EHM/ in laymans terms) I sell you some hay $50 a bussell/ we set a (firm price)  30 days later our contract expires/

  You can be made whole, or risk against future (input) crops. That is the Rick Santelli trade   bitchez

Sun, 12/16/2012 - 01:33 | 3068082 ekm
ekm's picture


I think the counterparties could be chinese and russian state owned banks.


Sun, 12/16/2012 - 02:13 | 3068094 Yen Cross
Yen Cross's picture

EKM, I need a power nap. London opens in 2 hours/ Thanks man CFDs

Sun, 12/16/2012 - 02:42 | 3068182 PlausibleDenial
PlausibleDenial's picture

CFD's?  Contract for differences?  If so, great estate planning tool.  It's all in the discounts.   I don't know how they are traded or even if they are newly on the screens.  However, some one on here was spamming a site not long ago.  Can anyone enlighten me???  Tnks.

Sun, 12/16/2012 - 03:04 | 3068202 Yen Cross
Yen Cross's picture

CFDs were banned by the CFTC  in 2010/ .  CFDS are still  a standard of trade ouside of the United States, and very"contentious" with international banks.

  The U.S. $ is rapidly losing it's reserve status. I'm silently trading against the $. The dollar is toast/ I sure as hell won't be trading yuan though!

Sun, 12/16/2012 - 03:10 | 3068206 Yen Cross
Yen Cross's picture

CFD is the term used as such , ( contract for delivery) !  Fiat and Metals trade the same scale/ Contract for Delivery.

 When you you look at markets during off hour sessions, CFDs give you a better reading than futures!

 BITCHEZ  Can I take nap now ya "Fire Brands" or should I explain that one?

Sun, 12/16/2012 - 00:08 | 3067927 lolmao500
lolmao500's picture

The only thing you need to cut is the corporate welfare in the medical system.

Sun, 12/16/2012 - 10:03 | 3068395 Bicycle Repairman
Bicycle Repairman's picture

Getting "sick care" under control is a necessary and sufficient condition.

Sun, 12/16/2012 - 12:04 | 3068570 azusgm
azusgm's picture

You have to go after the FDA and the AMA. Protocols solidified into standards of care are monopolistic too.

Sun, 12/16/2012 - 00:16 | 3067935 hannah
hannah's picture

prs hussein has the repubs by the balls and he knows it. good for him. the repubs have played along with the dems for decades giving them everything because they thought it benefited them but now they are old shriveled and fucked....let the dems reign of tax terror begin....LOL...!

Sun, 12/16/2012 - 00:27 | 3067948 dolph9
dolph9's picture

America is not a country.  Keep that in mind whenever you don't know what to make of the actions of the politicians.

America is an Empire carefully managed by banks and corporations for their benefit.

Now, I'm not making a judgment on that.  Please do not think this.  But at least we need to recognize the facts and then we can have a debate on what to do next.

The only recent equivalents to America that I can think of are the old Soviet Union and the current European Union.  The former wasn't a country, and collapsed, and the latter isn't a country, and is in the process of collapsing.

Hell even the United Kingdom is in the process of breaking apart.

Any guess on what happens next?

Sun, 12/16/2012 - 00:32 | 3067965 azusgm
azusgm's picture

Yeah, Japan will go right after Germany.

Not time to get under the desk yet, but soon.

Sun, 12/16/2012 - 00:29 | 3067959 azusgm
azusgm's picture

What country is this? Why are Harry Reid, Boohoo Boehner, and Barack Hussein Obama meeting and cutting deals? I can't find that in the Constitution. Spending bills are supposed to originate in the House of Representatives. If nothing comes out of the House (not the White House) turn out the lights until the members of congress have huddled in the dark long enough to come up with a budget. Let the senate and Obama leave on vacation, but the House stays.

Can't these idiots (mostly lawyers) read?

Sun, 12/16/2012 - 01:15 | 3068051 TrulyBelieving
TrulyBelieving's picture

Yes, these idiots can read, but constitutionality is not on their menu.

Wed, 12/26/2012 - 17:39 | 3097308 MeelionDollerBogus
MeelionDollerBogus's picture

They can read a prepared 2 minute oratory in the House but when's the last time they read a bill before passing it?

Sun, 12/16/2012 - 03:48 | 3068229 blunderdog
blunderdog's picture

They're trying to prevent laws they've already passed from coming into effect.  It'd be a lot funnier if we didn't pay them WAYYYY too much to do this sort of thing.  I think they're delivering decent performance for an $18,000/year salary, but really, the whole place should be staffed with interns.

Sun, 12/16/2012 - 18:28 | 3069378 bugfixx
bugfixx's picture

The President is supposed to sign a budget passed by Congress, though they haven't been doing that since the majority of American voters elected Barry O as King Executive Order the 1st.

Sun, 12/16/2012 - 00:40 | 3067970 Yen Cross
Yen Cross's picture

 I made the right decisions. That 5 point gartly patern is dumb/ ( i tried it Orly)  Trade short term trend lines/  Ninja old school trading.


Sun, 12/16/2012 - 01:04 | 3068020 TrulyBelieving
TrulyBelieving's picture

        Truly amazing times, a country in the flux of change. The very ones who have sworn an oath to protect Liberty and freedom that is guaranteed by the Constitution are the ones who are destroying it. The universities and colleges that instead of enlightening our youth with the truth and basic knowledge, are teaching them the foreign doctrine of Marxism and socialist ideas. The compliant media, daily reinforces the lies and lays cover for these haters of Liberty. And my fellow citizens, by far the majority could care less about it all, or worse, are actually voting for the demise of the very freedoms they naively posess.  There should be no doubt, if history is any guide, that dark times are indeed just ahead, for statism leads to tyranny and socialism leads to poverty.      FOWARD!            

Sun, 12/16/2012 - 18:31 | 3069385 bugfixx
bugfixx's picture

You have to stop thinking that the statists we elect remotely care about results. They only care about voter perception of those results, which is why the corporations control the establishment media.

Sun, 12/16/2012 - 01:00 | 3068022 seek
seek's picture

Given how little the last QEn announcement impacted the markets, I think Ben (and his proxies, O and the (R) team) could get the shock of their life if the market tanks on the cliff.

If it's taking $85B/mo to stay even, and nothing moved last time, a crash could either be unrecoverable, or unleash some real numbers.

While I still think 2015-2018 is where it all falls apart, maybe the black swan is that they own so much of the market, there are no "animal spirits" left to spook in the desired direction.

Sun, 12/16/2012 - 01:11 | 3068043 q99x2
q99x2's picture

Garnish their wages. Put liens on their properties. Impeach them. Arrest them.

Sun, 12/16/2012 - 01:54 | 3068126 Yen Cross
Yen Cross's picture

Better check yer "pillGING POWER"  Play nice or ""be "Broadsided"  with cannons

Sun, 12/16/2012 - 18:33 | 3069387 bugfixx
bugfixx's picture

The statists in Congress and the White House will just nationalize 401k/IRA accounts and eat through everyone's savings until Barry O retires to a palatial estate in Hawaii with a private golf course.

Sun, 12/16/2012 - 01:11 | 3068046 batterycharged
batterycharged's picture

So is "high earners" the new "job creators" because frankly there are some wealthy people that don't fucking EARN shit.

I noticed that the talking heads are sneaking this in more and more. Even Bill Clinton couldn't say "rich people" or "the wealthy".

Sun, 12/16/2012 - 01:28 | 3068078 Atomizer
Atomizer's picture

Just swagger this all around town. You're bound to make new poor friends..

Sun, 12/16/2012 - 01:28 | 3068054 One World Mafia
One World Mafia's picture

Stock reset opportunity? get a fresh batch of shorts so the squeeze trap can be replayed "since the only time shorts re-enter the market, even against their and everyone else's better judgment, is just after major market tumbles."

Sun, 12/16/2012 - 01:33 | 3068086 Yen Cross
Yen Cross's picture

 I',m fucking tired, the Gooberment is going to FAIL, Jet Lag Bitchez/  Asia is getting ready to open/ Sheng Hai is going to sell off/

 22K are you kidding me> should be high 16s

Sun, 12/16/2012 - 01:55 | 3068130 Yen Cross
Yen Cross's picture

Arree Ye  Mate''es

Sun, 12/16/2012 - 02:06 | 3068144 JLee2027
JLee2027's picture

Boehner will crack wide open, like the pretend Republican he is. Just watch. The only question is whether he has enough traitorous turncoats to pass whatever they agree to.

Sun, 12/16/2012 - 12:14 | 3068595 Lednbrass
Lednbrass's picture

I don't understand this criticism- Boehner is exactly what the Republican party has always been. The party was founded on the concept of Central Government Uber Alles and has pursued exactly that for over 150 years.

Did you actually believe their stream of lies that they favor reduced government, self reliance, yada yada yada? I argue that a RINO isn't a Republican who advances Big Government and The State, a RINO is someone belonging to that party who actually believes in reduced federal power, spending, and the Constitution.

He isn't out of step with the Republican party- you are.

Sun, 12/16/2012 - 15:33 | 3069007 JLee2027
JLee2027's picture

Respectfully, I don't think you understand what the Republican party used to stand for.

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