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How The Fiscal Cliff Talks Collapsed

Tyler Durden's picture


The collapse of the Fiscal Cliff talks should come as no surprise to anyone (except, of course, for all those "expert" political commentators virtually all of whom saw a deal by December 31: a full list of names is forthcoming). The reason: a simple one - a House torn, polarized to a record extreme, and a political environment in which the two parties, in the aftermath of a presidential election humiliating to the GOP, reached unseen before antagonism toward each other. In this context, it was absolutely inevitable that America would see a replica of last summer's debt ceiling collapse, which mandated a market intervention, in the form of a crash, and the wipeout of hundreds of billions in wealth - sadly the only catalyst that both parties and their electorate, understand. We had prefaced this explicitly in early November when we said that "the lame duck congress will posture, prance and pout. And it is a certainty that in the [time] remaining it will get nothing done. Which means, that 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." Which of course brought us to Thursday night's mini-TARP moment.

If you missed Thursday's ES flash crash, fear not: there will be more "TARP moments" as first the Fed is brought into action (as we reminded yesterday), and then, as the final deadline - that of the expiration of various debt ceiling extension gimmicks which takes place in March, and which is the real deadline for a deal. Nonetheless, there are those forensic detectives who are addicted to every single political twist and turn, and who are curious just where and when the Fiscal Cliff talks broke down in the past week. In this regard, the WSJ provides a useful timeline.

From the WSJ:

Mr. Obama repeatedly lost patience with the speaker as negotiations faltered. In an Oval Office meeting last week, he told Mr. Boehner that if the sides didn't reach agreement, he would use his inaugural address and his State of the Union speech to tell the country the Republicans were at fault.


At one point, according to notes taken by a participant, Mr. Boehner told the president, "I put $800 billion [in tax revenue] on the table. What do I get for that?"


"You get nothing," the president said. "I get that for free."

Well, you can't fault the man at not demonstrating "leadership" at crucial junctions: after all it's only fair he gets something for free.

The White House's first formal offer, presented Nov. 29 left Mr. Boehner incredulous. It included a request for $1.6 trillion in additional tax revenue over 10 years, a permanent increase in the debt ceiling and money for road projects and other year-end priorities. In return it offered spending cuts of $400 billion—25 cents for each dollar in new revenue.


Taking a drag on his cigarette, Mr. Boehner asked Treasury Secretary Timothy Geithner, who had presented the plan, a number of questions but didn't fully engage him. Across the Capitol, Senate Minority Leader Mitch McConnell (R., Ky) said he laughed at the offer.


The same sticking points kept rearing up—the White House insisting on more tax revenue than Republicans could stomach, and the Republicans demanding deeper cuts than the White House would accept.


During one session in the Capitol with White House's legislative liaison Rob Nabors, Mr. Loper from the Boehner camp asked, referring to a near-deal during last year's debt-ceiling fight: "Can you get back into the zone of where you were in July 2011?"


"No," Mr. Nabors replied. "We were probably overextended then, and there's no way we would do it now."


Mr. Nabors said if they couldn't reach a deal, they should keep lines of communication alive. The typically serious Mr. Loper asked, "So, you're breaking up with us?"


On Dec. 13, Mr. Boehner went to the White House at the president's request, joking he was going to the woodshed.


The president told him he could choose one of two doors. The first represented a big deal. If Mr. Boehner chose it, the president said, the country and financial markets would cheer. Door No. 2 represented a spike in interest rates and a global recession.


Mr. Boehner said he wanted a deal along the lines of what the two men had negotiated in the summer of 2011 in a fight over raising the debt ceiling. "You missed your opportunity on that," the president told him.


That night, the speaker and Majority Leader Eric Cantor (R., Va.) decided to make the biggest concession so far.


As the country the next day digested news of a brutal school shooting in Connecticut, Mr. Boehner called the president and for the first time offered to let tax rates rise—on income above $1 million. The president acknowledged the concession but said Mr. Boehner's plan wasn't raising enough revenue.


News broke the next night both about the concession and that the speaker was willing to extend the borrowing limit. On Sunday, the White House sent a plane to fly Mr. Boehner back to Washington for a morning appointment with the president on Monday, the day it now appears the deal fell apart.


In that session, the president held firm for $1.2 trillion in additional tax revenue, a second step down from his original offer. Mr. Boehner asked for another $100 billion in spending cuts but couldn't get a commitment.


Finally, the speaker said, "Well, you and I can sit here and stare at each other," or he could leave and they would talk later.

Eventually, Boehner managed to turn the tables on a president who was convinced he would get all the concession he demanded. Or so Boehner thought:

Back in the Capitol, Mr. Boehner told Mr. Cantor the president wasn't moving. They agreed to call him. On the call, Mr. Boehner restated he needed $1 in spending cuts for every $1 in revenue raised. He dropped a prior demand to increase the Medicare eligibility age.


The president told Mr. Boehner that he was willing to make some concessions on taxes and spending, but cautioned that they needed to retain Democratic votes for the bill to pass.


The speaker raised the prospect of moving a backup bill. White House officials said Mr. Boehner didn't reveal what Plan B comprised. Administration officials expected a few more days of back-and-forth, but the speaker thought the prospects were dim for a big deal.


Meeting with his leadership team in the afternoon, Mr. Boehner read from a script prepared by his staff, telling lawmakers he still wanted a big deal but the rank and file needed to know the plan by a 9 a.m. conference meeting the next morning, Tuesday. He encouraged his colleagues to accept the backup plan.


"I'm going to keep the proposal on the table," he said of the broader deal. "As I told the president, I'm not making an ultimatum. The offer stays on the table, even if we move on Plan B."


His lieutenants made clear they preferred Plan B to the one Mr. Boehner was trying to broker.


The speaker called the president with news the House would move ahead with the backup bill, which would preserve Bush-era rates for all income below $1 million. The president was incensed.

Everyone knows what happened what Boehner was finally unable to get even the votes needed for "Plan B." And what happened after that too:

On Friday afternoon, the president spoke to both Mr. Boehner and Senate Democratic leader Harry Reid in a bid to resurrect a deal. Soon afterward he left the White House for his annual family vacation in Hawaii.

And from Reuters:

The president is expected to indulge in some of his favorite pastimes on the island where he was born and raised: golf, an expedition for the local treat "shave ice," and an evening out with family and friends. He hit the links at the nearby Marine Corps base under sunny skies on Saturday afternoon.

Needless to say no deal will be "resurrected", and the US economy, like the Coyote, will go right off the cliff, with hopes for a prompt fix in the early days of January, at which point, the thinking supposedly goes, all those managers who fired tens of thousands of workers due to the new "post-Cliff" reality will miraculously rehire them back. After all the market said so: the same "efficient" market which continued to plow higher for three days after it is now clear the deal had fallen apart.

Next steps: nothing out of Washington for three months, even as Obama crucifies the GOP at every possible public opportunity, and another credit downgrade of the US, which initiates the early 2013 risk off phase, and the scramble into the "safety" of US bonds once more as was the case in 2011. In doing so it will provide a cover to all those sell side "strategists" (all of them) who once again, erroneously, predicted a recovery for the US in the coming year. After all who could have possibly anticipated the most perfectly logical political outcome...  Because the one thing that is most important to both parties is to maintain demand for US paper, as that, and not taxes, in both the coming year and decade, will consistently be primary source of 'funding' for the US government.


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Sat, 12/22/2012 - 19:35 | 3090327 Eireann go Brach
Eireann go Brach's picture

Who cares about the well being of 350 million Americans, I have 7 golf games booked in Hawaii that I committed too!


Barack Obama

Sat, 12/22/2012 - 20:36 | 3090407 Fredo Corleone
Fredo Corleone's picture

It is evident that Boehner is out of his depth, and may be wanting of the requisite "skill set" to be an effective leader in this agitated political climate -- the hand-to-hand political skills required to parry with the likes of a hardened community organizer. Politics in the contemporary Washington are no gentleman's game.

That said, the Administration, for its part, may be grasping for a bit too much, operating under the assumption that the "public" is wholly in agreement with its rigid "soak the rich," pro-tax agenda and attendant GOP-deprecatory rhetoric.

Opinion: the GOP may have less to fear than it currently has convinced itself; conversely, the Administration is playing a very dangerous game of public opinion chicken -- with a public who, time after time, has demonstrated itself to be the exemplar of the inconstancy of "persuasion."

Sat, 12/22/2012 - 20:41 | 3090447 trav777
trav777's picture

yeah; Obama is clueless if he thinks he has the mandate to make this happen.

the blame game works until it doesn't and 2 years from now is a long time.

Sat, 12/22/2012 - 22:01 | 3090603 JLee2027
JLee2027's picture
  • "potatoe"
  • "Mission Accomplished"
  • "voodoo economics"
  • "I never had sex with that woman"

The blame game will work as long as the media wants it to.


Sat, 12/22/2012 - 22:21 | 3090642 flacon
flacon's picture

Can someone explain why MARCH is so important (more important than January 1st)? We are already at debt limit right now...

Sat, 12/22/2012 - 23:38 | 3090781 AGAU
AGAU's picture

I would put it to you that the debt limit matters not a jot at this stage.

Sun, 12/23/2012 - 02:52 | 3090903 Michaelwiseguy
Michaelwiseguy's picture

Really cool Geo-engineering video;

chemtrails 12.20.12 - pedro mandingo      

The dead body count from freezing conditions in the Northern Hemisphere this winter season is hilarious.

Cold Blast Claims Over 600 Lives Across Eastern Europe/Russia…”Death Toll Keeps Rising…State Of Emergency”

Crazy Russian Winter: What happens to boiling water at -41C? 

Here's a pretty cool chart of what the Sun has been doing in your lifetime.

Magnetic Field:
Solar Polar Fields – Mt. Wilson and Wilcox Combined -1966 to Present

Sun, 12/23/2012 - 06:38 | 3091053 Supernova Born
Supernova Born's picture

The so-called "fiscal cliff" is nothing but the MSM's euphemism for dealing with economic reality.

Sun, 12/23/2012 - 09:20 | 3091071 GetZeeGold
GetZeeGold's picture



Maybe we should just turn our eyes away and kick the can.......well the twisted lump of metal that use to be a can.


If we actually have to deal with this...the rap industry will be devastated.


Either Boehner gives his grandkid's future away.....and he might get re-elected.....or he falls on the grenade and saves our children's future.


Gut check time Amigo. What's it going to be?

Sun, 12/23/2012 - 10:28 | 3091209 sessinpo
sessinpo's picture

A complete joke. Boehner is set as are most politicians. As ZH suggested, and I also put it as a likely #1 scenario weeks ago, it was destined to fail. If not now, but later on because BOTH parties are eventually about bigger government and "real" cuts in spending are not in that equation.

What you don't realize is Boehner did fall on the grenade, but not for America or its citizens. He fell on the grenade for liberalism. Yes, I said it - even though Boehner is a republican, he is like the majority of politicians which is about bigger government and power.

The nonsense talk from most RINOs about cutting taxes has nothing to do with reducing government and government's power. We have extreme leftist that rule the democrat party and we have moderate liberals that rule the republican party. We do not have a large number of "real" conservatives and Constitutionalist in the Federal government anymore.

Sun, 12/23/2012 - 10:36 | 3091223 GetZeeGold
GetZeeGold's picture



The dude's totally a Republican....he's just not a conservative. You know....sorta like Newt Gingrich.

Sun, 12/23/2012 - 13:18 | 3091451 YBNguy
YBNguy's picture

We must petition for a cooler looking celebri..err..Commander in Chief!

Sun, 12/23/2012 - 04:14 | 3090952 From Germany Wi...
From Germany With Love's picture

Quick, can somebody spare $21.76 for Obama and Boehner before christmas:

Srsly, you guys are f*cked. We had the same situation with hyper-polarization here in Germany, back when we were the sick man of Europe (thanks to massive capital flow into the periphery which was entirely based on illusions, of course). But then came the 2005 election which forced the CDU and SPD into a Grand Coalition. So they were forced to collaborate. Of course, nowadays we have the problem that the parties are too similar but having a Grand Coalition every few years helps to overcome hyper-polarization, thank goodness.

Now back to money-printing...

Sun, 12/23/2012 - 04:59 | 3091016 TPTB_r_TBTF
TPTB_r_TBTF's picture



When the US coughs, Europe gets a cold.

"Srsly, you guys are f*cked."

Sun, 12/23/2012 - 07:24 | 3091059 From Germany Wi...
From Germany With Love's picture

Sure, if all you have in mind is economics.



Sun, 12/23/2012 - 09:40 | 3091146 NumberNone
NumberNone's picture

How about Europe becoming Muslim within 15 years?  How do you feel about Sharia and the quality of life it will bring?  Enjoy the demographic turmoil headed your way.  

Sun, 12/23/2012 - 09:50 | 3091154 knukles
knukles's picture

No demographic shifts in America, thank Satan

(take however your little heart desires, but tell ya, the way the voting been going, ain't no racists here, muthafuckah)

(tossing up hands, rolling eyes, wondering just how we got to where we are... mumbling, grumbling something about "Who am I to judge these assholes?")

Sun, 12/23/2012 - 11:44 | 3091332 From Germany Wi...
From Germany With Love's picture

Im not worried about the overall picture. Neither the US nor Russia will tolerate a muslim Europe.



Sun, 12/23/2012 - 08:11 | 3091082 Tom_333
Tom_333's picture

Doesn´t matter.The Ponzi circus will just keep on for a long , long time. There´s still a lot of taxes to be levvied,work to be forced,surveillance to be implemented,camps to be filled with dissenters,sheeple to be stripsearched and forcibly made to obey...and on and on.

Meanwhile quality of life in Europe is still better than stateside.Much better food,no corn syrup additives,better health in general.Though the (non) elected leaders here are a bunch of absurd clowns it´s still a shade better than what currently has been put in place in the surveillance empire of the U.S. And there´s a silver lining...Silvio may stage a comeback.That guy really knows how to throw a party.And I am happy to say that natural male behaviour is much more acceptable here then over there.No one really cares to much.In stark contrast to the tranmutation of puritanical doublemoral into a puritanical surveillance and control empire.The best way to ward off longings for America is to go to the web and read the news.Janet Napolitano is the perfect symbol,the perfect embodiment of what the U.S. has turned into.

If I should feel any desire to change my abode again I would make a move to Asia.I will sit this one out.I am too old and have done too much to get marching orders on a daily basis from DHS,TSA and all the rest of the alphabet soup.They can keep their spying to themselves or at the bare minimum the should be more sophisticated about it. Actually the conjured threats that pass as a motivation for this circus is just a sorry excuse for beating Joe Sixpack into further submission.

Sun, 12/23/2012 - 09:52 | 3091156 Chief KnocAHoma
Chief KnocAHoma's picture

A light just went off over my head - If no deal is reached and there is a financial panic, demand for zero or even negative return gobernmint funny money bonds will soar. 

So tell me the incentive these assholes have to act responsibily? If and when we go over, money floods into their control. If taxes go up, money floods into their control.

Fed and Government are playing rigged games with us.

Sun, 12/23/2012 - 10:17 | 3091194 overmedicatedun...
overmedicatedundersexed's picture

hey tom 333, been to london lately, you know the city with all those street cams? delude yourself but posting here you get a broken nose. EU the .gov control is to you, like water to a fish..

Sun, 12/23/2012 - 19:08 | 3091879 Tom_333
Tom_333's picture

It sure exists.Not disputing that.But it´s a more civilized tone about it than stateside.As for Europe -(as you may know UK isn´t really a part of Europe)...the surveillance in France,Italy,Germany and Switzerland is way less intrusive: If you visit Europe - you should go to Europe and not the outpost of anglosaxon NWD that hosts the City of London.Really not same thing.

Sun, 12/23/2012 - 10:23 | 3091203 Raymond K Hessel
Raymond K Hessel's picture

Last time the US govt had a Grand Coalition was in 1850


Sun, 12/23/2012 - 16:29 | 3091710 mkkby
mkkby's picture

There is no fucking polarization.  They agreed to this in 2011 -- if by the end of 2012 there is no agreement, cuts will be automatic and massive.  Thus, the credit rating will be saved.

So Obama wants to reneg on that agreement.  But BONER HOLDS ALL THE CARDS, because all he has to do is say NO and we go over the cliff -- meaning deep spending cuts.  Short term the markets go down, and lots of gov workers get laid off.  But long term the country is much better off.

The 2011 agreement was kicking the can until NOW.  My bet is they will just agree to raise the debt limit for another 2 years and get through the next election without any changes at all.  I'll be buying gold the moment everyone else besides me realizes that.

Sat, 12/22/2012 - 23:38 | 3090782 caconhma
caconhma's picture

There Is No Nobel Prize in Economics

October 12, 2012  |



It’s Nobel Prize season again. News reports are coming out each day sharing the name of the illustrious winner of the various categories — Science, Literature, etc. But there’s one of the prizes that’s a little different. Well, that’s putting it lightly… you see, the Nobel Prize in Economics is not a real Nobel. It wasn’t created by Alfred Nobel. It’s not even called a “Nobel Prize,” no matter what the press reports say.


The five real Nobel Prizes—physics, chemistry, literature, peace, and medicine/physiology—were set up in the will left by the dynamite magnate when he died in 1895. The economics prize is a bit different. It was created by Sweden’s Central Bank in 1969, nearly 75 years later. The award’s real name is the “Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel.” It was not established by Nobel, but supposedly in memory of Nobel. It’s a ruse and a PR trick, and I mean that literally. And it was done completely against the wishes of the Nobel family.


Sweden’s Central Bank quietly snuck it in with all the other Nobel Prizes to give free-market economics for the 1% credibility. One of the Federal Reserve banks explained it succinctly, “Few realize, especially outside of economists, that the prize in economics is not an “official” Nobel. . . . The award for economics came almost 70 years later—bootstrapped to the Nobel in 1968 as a bit of a marketing ploy to celebrate the Bank of Sweden’s 300th anniversary.” Yes, you read that right: “a marketing ploy.”


“The Economics Prize has nestled itself in and is awarded as if it were a Nobel Prize. But it’s a PR coup by economists to improve their reputation,” Nobel’s great great nephew Peter Nobel told AFP in 2005, adding that “It’s most often awarded to stock market speculators .... There is nothing to indicate that [Alfred Nobel] would have wanted such a prize.”


Members of the Nobel family are among the harshest, most persistent critics of the economics prize, and members of the family have repeatedly called for the prize to be abolished or renamed. In 2001, on the 100th anniversery of the Nobel Prizes, four family members published a letter in the Swedish paper Svenska Dagbladet, arguing that the economics prize degrades and cheapens the real Nobel Prizes. They aren’t the only ones.


Scientists never had much respect for the new economic Nobel prize. In fact, a scientist who headed Nixon’s Science Advisory Committee in 1969, was shocked to learn that economists were even allowed on stage to accept their award with the real Nobel laureates. He was incredulous: “You mean they sat on the platform with you?”


That hatred continues to simmer below the surface, and periodically breaks through and makes itself known.  Most recently, in 2004, three prominent Swedish scientists and members of the Nobel committee published an open letter in a Swedish newspaper savaging the fraudulent “scientific” credentials of the Swedish Central Bank Prize in Economics. “The economics prize diminishes the value of the other Nobel prizes. If the prize is to be kept, it must be broadened in scope and be disassociated with Nobel,” they wrote in the letter, arguing that achievements of most of the economists who win the prize are so abstract and disconnected from the real world as to utterly meaningless.


The question is: Why would a prize that draws so much hatred and negativity from the scientific community be added to the Nobel roster so late in the game? And why economics? To answer that question we have to go back to Sweden in the 1960s.


Around the time the prize was created, Sweden’s banking and business interests were busy trying to ram through various so-called "free-market" economic reforms. Their big objective at the time was to loosen political oversight and control over the country’s central bank.


According to Philip Mirowski, a professor at the University of Notre Dame who specializes in the history of economics, the “Bank of Sweden was trying to become more independent of democratic accountability in the late 60s, and there was a big political dispute in Sweden as to whether the bank could have effective political independence. In order to support that position, the bank needed to claim that it had a kind of scientific credibility that was not grounded in political support.”


Promoters of central bank independence couched their arguments in the obscure language of neoclassical economic theory of market efficiency. The problem was that few people in Sweden took their neoclassical babble very seriously, and saw their plan for central bank independence for what it was: an attempt to transfer control over economic matters from democratically elected government and place into the hands of big business interests, giving them a free hand in running Sweden’s economy without pesky interference from labor unions, voters and elected officials.


And that’s where the Swedish Central Bank Prize in Economic Sciences came in.

The details of how the deal went down are still very murky. What is known is that in 1969 Sweden’s central bank used the pretense of its 300th anniversary to push through an independent prize in “economic science” in memory of Alfred Nobel, and closely link it with the original Nobel Prize awards. The name was a bit longer, the medals looked a little different and the award money did not come from Nobel, but in every other way it was hard to tell the two apart. To ensure the prize would be awarded to the right economists, the bank managed to install a rightwing Swedish economist named Assar Lindbeck, who had ties to University of Chicago, to oversee the awards committee and keep him there for more than three decades. (Lindbeck’s famous free-market oneliner is:  “In many cases, rent control appears to be the most efficient technique presently known to destroy a city — except for bombing.”)


For the first few years, the Swedish Central Bank Prize in Economics went to fairly mainstream and maybe even semi-respectable economists. But after establishing the award as credible and serious, the prizes took a hard turn to the right.


Over the next decade, the prize was awarded to the most fanatical supporters of theories that concentrated wealth among the top 1% of industrialized society of our time.


In 1974, five years after the prize was first created, it was awarded to Friedrich Hayek, one the leading "laissez-faire" -- enrich the rich -- economists of the 20th century and the godfather of neoclassical economics. Milton Friedman, who was at the University of Chicago with Hayek, was not far behind. He won the prize just two years later, in 1976.


Both Hayek and Friedman were huge supporters of the political independence of central banks. In fact, they built their careers on bashing government intervention in economic matters. Hayek developed a whole business cycle theory that blamed government and government-controlled banking systems  for all economic ills. He also equated all government intervention will inevitably lead to totalitarianism. Friedman with a whole new subsection of neoclassical economics called “Monetarism” that had a scientific formula worked out, specifying exactly how much money central bankers needed to keep floating around in the economy to keep inflation low and unemployment high enough to keep big business happy. No democratic control over banking policies needed, just let the free-markets do its thing!  The Swedish central bankers couldn’t get better spokesmen for their cause.


But Hayek and Friedman’s usefulness went way beyond Sweden.

At the time of the prizes, neoclassical economics were not fully accepted by the media and political establishment. But the Nobel Prize changed all that.

What started as a project to help the Bank of Sweden achieve political independence, ended up boosting the credibility of the most regressive strains of free-market economics, and paving the way for widespread acceptance of libertarian ideology.


Take Hayek: Before he won the award, it looked like Hayek was washed up. His career as an economist was essentially over. He was considered a quack and fraud by contemporary economists, he had spent the 50s and 60s in academic obscurity, preaching the gospel of free markets and economic darwinism while on the payroll of ultra-rightwing American billionaires. Hayek had powerful backers, but was out on the fringes of academic credibility.


But that all changed as soon as he won the prize in 1974. All of a sudden his ideas were being talked about. Hayek was a celebrity. He appeared as a star guest on NBC’sMeet the Press, newspapers across the country printed his photographs and treated his economic mumblings about the need to have high unemployment in order to pay off past inflation sins as if they were divine revelations. His Road to Serfdom hit the best-seller list. Margret Thatcher was waving around his books in public, saying “this is what we believe.” He was back on top like never before, and it was all because of the fake Nobel Prize created by Sweden’s Central Bank.


Billionaire Charles Koch brought Hayek out for an extended victory tour of the United States, and had Hayek spend the summer as a resident scholar at his Institute for Humane Studies. Charles, a shrewd businessman, quickly put the old man to good use, tapping Hayek’s mainstream cred to set up and underwrite Cato Institute in 1974 (it was called the Charles Koch Foundation until 1977), a libertarian thinktank based on Hayek’s ideas. Even today, Cato Institute pays homage to the Swedish Central Bank Prize’s role in the mainstreaming of Hayek’s ideas and Hayek’s influence on the outfit:


The first libertarian to receive the Nobel Prize was F.A. Hayek in 1974. In the years leading up to the prize announcement, Hayek had reached a professional and personal nadir. Unable to maintain an appointment in the United States, Hayek had returned to Austria to take up a position at the University of Salzburg, Austria. With the announcement of the prize in 1974, however, Hayek’s work, and the fortune of Austrian economics, took a remarkable turn.


Hayek’s influence on Cato is profound. Two of Cato’s first books were by Hayek: A Tiger by the Tail: The Keynesian Legacy of Inflation & Unemployment and Monetary Policy: Government as Generator of the “Business Cycle.” Perhaps more than any other intellectual in the twentieth century, Hayek has inspired Cato and its researchers to develop policies that ensure a free society. When Cato moved into its current location in 1992, its auditorium was named in Hayek’s honor.

Friedman’s Nobel Prize had a similar impact. After getting the prize in 1976, Friedman wrote a best-seller, got his own 10-part PBS series Free to Choose and became President Ronald Reagan’s economic advisor, where he had a chance to put the society-crushing policies he developed in Chile under Pinochet.


Friedman would spend the rest of his time denying it, but he was deeply involved and invested in the Pinochet’s totalitarian-corporate  economic experiment. Chilean economist Orlando Letelier published an article in The Nation in 1976 outing Milton Friedman as the  “intellectual architect and unofficial adviser for the team of economists now running the Chilean economy” on behalf of foreign corporations. A month later Letelier was assassinated in D.C. by Chilean secret police using a car bomb.


Friedman’s monetary theory was used by Federal Reserve Bank Chairman Paul Volcker to restrict the money supply, plunging American into a deep recession, doubling the unemployment rate and had the added bonus of getting Reagan elected President. . . . And Hayek and Friedman were just the beginning.


For instance, in 1997 two economists won an award for their derivative risk models that minimized risk, just before the derivatives would explode in the 2000s real estate bubble.

Sun, 12/23/2012 - 01:14 | 3090878 willwork4food
willwork4food's picture

I still don't know why I have not been nominated. I've worked my ass off for decades, got it mostly stolen by Wall Street, then the IRS & State came down and said I owed them more because I margin traded. With this sacrifice, and without going on welfare, EBTs, or begging money @ intersections, I believe I'm  due.

Thank you for your support.

Sun, 12/23/2012 - 12:03 | 3091372 markmotive
markmotive's picture

The Nobel Prize in 'Peace' hasn't turned out to be real either.

Sun, 12/23/2012 - 05:42 | 3090894 piliage
piliage's picture

"In 2001, on the 100th anniversery (sic) of the Nobel Prizes, four family members published a letter in the Swedish paper Svenska Dagbladet, arguing that the economics prize degrades and cheapens the real Nobel Prizes."

Oh, sweet irony, as if giving the 'real' peace prize to the EU, Obama, Arafat, and ElBaradei doesn't? 

Sun, 12/23/2012 - 08:34 | 3091094 Tom_333
Tom_333's picture

Yeah - but please keep in mind - the peace prize is awarded by the Norwegian parliament.A clause in Nobels testament specified that they should be the executioners of that one. This has been a continual source of joy and merry to my Swedish friends (though closely related in language and otherwise - Norwegians have always been seen as much less sophisticated - a kind of little brother in the Scandinavian family). And they have for sure delivered on the peace price. Who´s getting the next peace prize is turning into a kind of parlor game at smaller social gatherings,for chuckles.Kony...Bibi....Bloomberg..who...who? My bet is that there will be something related to the de facto nullfication of the 2nd amendment coming up. Mike B may not be such a bad bet after all.Rest assured that the Norwegian Parliament will continue to demonstrate complete lack of grasp on contemporary events.They are the only ones who actually BELIEVE  the propaganda.

Sun, 12/23/2012 - 08:51 | 3091109 piliage
piliage's picture

Sadly, there are plenty more who drink the Kool-aid


Sun, 12/23/2012 - 12:21 | 3091400 shovelhead
shovelhead's picture

I got a cartoon flash of a union sewer worker arguing, while up to their chests in effluvia, with the non-union new hire.

"You're not a REAL sewer worker and besides that, you smell like shit."

Sun, 12/23/2012 - 04:54 | 3091010 BrigstockBoy
BrigstockBoy's picture

"UPDATE: It turns out that Yasha Levine and Mark Ames — the authors of the error-ridden hit piece on Hayek — come straight out of the bowels of Russian yellow journalism and pornography, specializing in National Enquire type made up “news” laced with lots of blood and nudity."


Sun, 12/23/2012 - 06:02 | 3091046 Acet
Acet's picture

All that bullshit for something really simple: Alfred Nobel never set up a Nobel prize in economics (he hated economists). The so-called Nobel Prize is in reality a "In the name of Alfred Nobel Prize" which is given by the Swedish Central Bank - i.e. economists are giving prizes to economists and passing it out as a "Nobel" Prize.

In other words, it's as valid as if the Swedish Association of Astrologists & Diviners set-up a (In the name of Alfred) Nobel Prize for Divination. In fact, giving that it turns out Economics majors are bigger liers than other majors (study:, their deep involvement in politics (with the results we've all seen) and their inability to predicts anything, I'd say the a Nobel Prize In Divination at least would reward a group with a better track record in honesty and prediction of future events.


Sun, 12/23/2012 - 10:28 | 3091206 Raymond K Hessel
Raymond K Hessel's picture

There's no prize for mathematics either.  


Nobel's wife was banging a mathematician that if there were a prize for mathematics, he'd get it.  So Nobel decided not to have one.  

True Story.

Sun, 12/23/2012 - 13:19 | 3091452 IrritableBowels
IrritableBowels's picture

Snopes would beg to differ...

Nobel was never married.

Sun, 12/23/2012 - 15:56 | 3091680 captain_menace
captain_menace's picture

"One of the problems with citing information found on the Internet is validating the authenticity of the information..." ~ Theodore Roosevelt

Sun, 12/23/2012 - 14:39 | 3091580 caconhma
caconhma's picture

From Wikipedia:


"The Prize in Economics is not one of the original Nobel Prizes created by the will of Alfred Nobel. However, the nomination process, selection criteria, and awards presentation of the Prize in Economic Sciences are performed in a manner similar to that of the Nobel Prizes."


I love the word SIMILAR. Is tungsten similar to gold? Certainly, there are many similarities.


It looks like we all live in a make-believe world of lies and fraud sold as something similar to honesty, integrity, and humanity.


Mon, 12/24/2012 - 02:20 | 3092384 bk1037
bk1037's picture

I'll answer you since no one else in ZH seems to want to take the time to explain it. Yes, we're at the debt limit now. But Geither and crew can use accounting and other gimmicks to extend the time where would more money would appear to be available but isn't truly. Geither borrows improperly from Fed employee retirement plans and he did this freely in July of 2011. This is the first money that must be repaid when the debt limit is extended. Tyler reported on this extensively back then. Geithner will do this until he has nothing left in there to cover his overdraft with these improper advances from other funds that no one understands in the public discourse. That will happen in March this time as ZH has been noting.

It has been argued that the debt limit is an arbitrary imposition of congressional authoroty since Congress has also mandated spending that creates this issue in the first place. Congress, who gets little blame many times for the debt limit, are the true beasts who cause the entire situation, under the President's auspices. I do expect the imposition of the 14th Amerndment this time with this the language about ' the debt of the United States shall not be questioned'. Language like this is similar to the 2nd amendment about the right to bear arms, broad but specific enough to allow desired interpretation to get a result. The debt limit is being aribitrarily applied instead of the Congressional spending authority mandates, and it may well be this time with the hyperpartisan brinkmanship that it breaks the back of the debt limit legislation once and for all. I mean why apply the 2nd amendment but not the 14th fully.


Sat, 12/22/2012 - 20:57 | 3090471 Ginsengbull
Ginsengbull's picture

It's not an administration, it's a regime.

Sun, 12/23/2012 - 03:57 | 3090975 Max in St Moritz
Max in St Moritz's picture

A regime?


Seems like there's a new form of McCarthyism taking root in America. But it's not as pervasive as it was in the 1950's. Most of the individuals who think Obama is a Russian agent, or a terrorist or the incarnation of Hitler are hillbillies from the American backwaters, or very simple-minded racist pigs who are easily seduced by right wing carnival barkers like Limbaugh, Hannity, Coulter and Beck.

Kentucky Fried Amuuurica!

Sun, 12/23/2012 - 05:10 | 3091020 TPTB_r_TBTF
TPTB_r_TBTF's picture

These backwater hillbillies are self sufficient and donT need the cradle-to-grave govt-nanny that you Europeans canT get by without.

Europe has already succumbed to the Communist Agenda.  The backwater hills of Amuuurica are the last redoubt.

Sun, 12/23/2012 - 09:00 | 3091084 GetZeeGold
GetZeeGold's picture



We've stopped naming our agendas......we just give them numbers now.


Our number is........21.

Sun, 12/23/2012 - 11:26 | 3091288 itstippy
itstippy's picture

Sorry, but there's no part in the U.S. where a large portion of the population doesn't rely on government largess.  The idea that "backwater hillbillies" are self-sufficient just isn't true.  It doesn't matter what the country-western singers put in their lyrics about how "country boys can survive".  A good share of them simply don't have jobs, or do have jobs but don't make enough money to get by.  So they get the SNAP cards and emergency medical assistance and heating/cooling assistance just like everywhere else in the U.S.A.

People are people.  Country Boy meets Country Girl; they make a Country Baby.  They need to provide for themselves and the young 'un.  To do this they need decent paying jobs.  Running around in a pickup truck with a hound dog and a shotgun just ain't gonna pay the household bills, no matter how romantic and awesome and satisfying the idea sounds.

Take away the debt-funded government entitlements and you'll get a whole shitload of Country Boys, Country Girls, Country Babies, and Country Grams & Gramps in a world of hurt.  It's not a good situation, but it's how things are.

Sun, 12/23/2012 - 13:11 | 3091447 Overfed
Overfed's picture

Just the way this (and the past few) regime wants it.

Sat, 12/22/2012 - 21:15 | 3090519 Ignatius
Ignatius's picture

Everytime I look they push another turd to the top.

"America's gonna crash, big time." -- Paul Craig Roberts

Sat, 12/22/2012 - 22:18 | 3090602 Michaelwiseguy
Michaelwiseguy's picture

What makes them think there is anything in the known universe that can stop the economic collapse? It is best to go off the cliff at ramming speed. We can call next years tax cuts the Obama tax cuts and remove the word "Bush" from our lexicon. Boner should have offered to close some of the 750 US military bases we got in 130 countries.

Sat, 12/22/2012 - 21:52 | 3090587 Absalon
Absalon's picture

The Republicans lack the individual personal self control to be led effectively.  The only place most of them would follow a leader would be into a whore house.

Sat, 12/22/2012 - 23:27 | 3090764 rqb1
rqb1's picture

You really think there are two teams?

Sun, 12/23/2012 - 09:03 | 3091073 Bob
Bob's picture


That's like asking why--like a CIA team scrubbing its tracks after its mission is complete--the Democratic Leadership Council disbanded last year . . .

Who WERE those guys?! Is it true they were actually funded by the Koch brothers? Couldn't be, right? After all, they set up both Clinton and Obama! They were part of the Democratic Party!

Outta sight, outta mind. The oldest trick in the book.

Now neo-liberalism is the only public narrative.  Reach-around or no reach-around is the only real question on the table. 

There couldn't be any other ideas for WTF we should do about the deficit, right?


Sun, 12/23/2012 - 09:41 | 3091147 kill switch
kill switch's picture




The 19 so far down arrows are still drinking the fucking Kool-aid,,,the idiotic distinction between repub and dems LEFT RIGHT what a charade..


The kill switch

Sun, 12/23/2012 - 00:20 | 3090826 SanOvaBeach
SanOvaBeach's picture

I agree!  But hear this.  Keep the Republicians out of my bedroom and the Democrats out of my wallet.

Sun, 12/23/2012 - 08:27 | 3091088 GetZeeGold
GetZeeGold's picture



Apparently there are at least three idiots roaming the earth that have a problem with that......perhaps more.

Sun, 12/23/2012 - 10:32 | 3091217 sessinpo
sessinpo's picture

So you would be fine with republicans in your wallet and democrats in your bedroom?

You have serious problems. Keep all them out of my bedroom and out of my wallet or I'll introduce you to Smith and Wesson.

Sun, 12/23/2012 - 10:45 | 3091225 GetZeeGold
GetZeeGold's picture



democrats in your bedroom?


So that's why they need free healthcare.


Put the gun down Amigo.....until you've been checked out by the mental health's totally free.

Sun, 12/23/2012 - 12:23 | 3091404 SanOvaBeach
SanOvaBeach's picture

Your a stupid redneck fuck.  Go out and shoot some school kids, you'll feel better, asshole.

Sun, 12/23/2012 - 10:02 | 3091165 Chief KnocAHoma
Chief KnocAHoma's picture

What's that? Did someone say whore house?

Sun, 12/23/2012 - 10:07 | 3091172 Uncle Remus
Uncle Remus's picture

Ho ho ho.

Sun, 12/23/2012 - 02:13 | 3090915 monkeyshine
monkeyshine's picture

Regardless of what I think should be done, which like most around here is wildly different than those from both parties in Washington, it is clear that both sides need to work together if they want to get something done. That is a big if, since going over the cliff does give both sides a victory, but less of a victory to Obama and the dems who will have to explain to America's middle class why their taxes went up and services went down. The GOP voting against their leadership is good political drama. Boehner asked for tax increase on $1M plus knowing Obama would not accept it anyway, but the fact that his party also rejected it puts the onus clearly and directly on the White House to come to the table with serious new ideas. Contrary to reports, it was not a rebuke of Boehner rather a rebuke of the process Boehner has been put through. Contrary to media reports, this is +1 for the GOP.

Sun, 12/23/2012 - 08:39 | 3091098 11b40
11b40's picture

In your wet dream, maybe, but not in the real world. Epic fail for Boner, and he knows it. Just watch Obummer as he ties this around the neck of the Tea Party controlled GOP and beats them about the head & shoulders.
The Tea party dorks are, generally speaking, either right-wing political charlatans, dumb as a bag of rocks, or both. Boner has an impossible job, & Obummer is holding the winning hand. It's just politics.

Sun, 12/23/2012 - 10:09 | 3091171 monkeyshine
monkeyshine's picture

That is the conventional wisdom, so don't worry there is no shame in being average. Nothing in Washington happens by accident. There was a vote in the house, which the Senate would not even consider not least because it is in recess, and which the President said he would veto. So in what way does this matter? Why would the GOP leadership put up a vote they know they couldn't pass? It is just politics and in this case The GOP calculates that by this stunt they will force the President to come up with new ideas. Boehner now gets to say "I tried a compromise Mr President but my party won't even back me, you sir need to help me help you. We are in crisis etc etc". Again, just politics and the art of negotiation. You don't really think the GOP is negotiating with itself in broad daylight do you? No it is a ploy. They have set it up so that Obama's hard line has to soften to the extent that he will have to 'save' the GOP from itself as it were. It is that, or over the cliff we go. You think that Obama and the Democratic Party wants that just to score points? An albatross as you put it, which lasts for 2 years? That's a delusion. Obama has an agenda to pass this term, none of which will occur if we go over the cliff because there will be no money for it. What we saw was pure political theater designed to force the White House to negotiate with the hardest line of the GOP, which is apropos considering he has thus far forced the GOP moderates to negotiate with the hardest line in the White House eg Geithner et al.

Sun, 12/23/2012 - 10:25 | 3091204 11b40
11b40's picture

Thanks for the edumacation, I'm sure.

The abatross is real, but does not have to last for 2 years.  It's just one more thing to add to the heavy sack of negativity the right wing of the GOP is dragging around.

Going over the curb will be blamed on the GOP, not the Dems.  There has been no compromise whatsoever form the Tea Baggers, so please explain why he White House should be bothering at all...other than to make sure the blame is cast in the direction they want?

And, in the interest accuracy, the House GOP di not put forth a bill they could not pass.  Boner pulled the bill when he found out he could not pass it....after spouting off about how he was going to get it done.  That is the crux of the matter. 

There really is not shortage of 'average' folks out there ;-)

Sun, 12/23/2012 - 11:06 | 3091265 Oldwood
Oldwood's picture

Politics aside, how will any tax increases solve or even help anything. All cuts that have been proposed are cuts in growth of spending, so none of this actually adresses the deficit or debt. Both will continue to grow. So again, who does a tax increase help? Or is it simply the pound of flesh that is all important? IS this about revenge? Anyone who is willing to publicly state these facts is an extremist idiots and will be punished. Are they supposed to support some compromise that accomplishes nothing just so they can demonstrate to the people that they are not radicals, just empty suits who will yield to any and all populist view points for political points?

Sun, 12/23/2012 - 12:53 | 3091430 11b40
11b40's picture

Look...I am not arguing about the right or wrong of any of these policies, just the politics.  I will admit, however, that I am very tired of seeing hedge fund managers and investment bankers make billions of dollars and pay very litle in the way of taxes.  Will taxing them more solve the problem?  Of course not, and enither will any one thing or the other.  IF (and it is a big if) we are to have any hope of a solution, it will only be due to compromise and sacrifice.  Loks pretty bleak from where I sit.

Sun, 12/23/2012 - 10:52 | 3091242 GMadScientist
GMadScientist's picture

The GOP put up a vote that wouldn't pass because that kind of Kabuki is sufficient to entertain and pacify the TeaParty collegia.

Sun, 12/23/2012 - 12:56 | 3091431 knightowl77
knightowl77's picture

As a very limited Gov't, low taxes and much lower spending, supporter (aka Tea Party)  I am surprised. I thought most ZHers' supported limited Gov't, & less spending ???? From the comments, I can see that most here are Progressives or establishment Republicans. Too bad....

Personally, I think Boehner ought to bring up the Prez & DNC plan to raise taxes on the rich, capital gains and dividends and let the Dems all vote in favor while the Repubs vote NO or Present and then hang this Albatross around their necks...

Sun, 12/23/2012 - 13:40 | 3091486 GMadScientist
GMadScientist's picture

Yeah that worked great for Newt...uh...hmm...can't seem to remember his last name. Gingrinch? Something like that.

I'm for moving in the direction of fiscal sanity, which involves dialing both knobs in the right direction.

So the TeaParty supports ending:

- The War in Afghanistan

- The War on Drugs

- The War on Civil Liberties

...or only cuts that affect "other people"?

Sun, 12/23/2012 - 17:04 | 3091764 hound dog vigilante
hound dog vigilante's picture

Yes, the Tea Party is indeed in favor of ending foreign wars & trumped-up domestic "wars".  You and most others insist on digesting the MSM's perception of the Tea Party, which is a sad mistake.  I don't see/hear Tea Party members supporting Boehner nor Palin nor the Koch bros. nor much of anything that the MSM insists that the TP 'stands for'.

Please by all means keep underestimating the Tea Party. Keep telling yourself the TP is a waning fringe movement. 

The TP has already blown-up the GOP, and the Dems are next...

One could argue that the two-party (one-party, actually) era is finished, and the TP has a head-start in the emerging paradigm... 


Sun, 12/23/2012 - 19:05 | 3091871 11b40
11b40's picture

 "I don't see/hear Tea Party members supporting Boehner nor Palin nor the Koch bros. nor much of anything that the MSM insists that the TP 'stands for'."

Then you must have your head placed somewhere other than on your shoulders.  Else you have a serious case of willful ignorance.  Who do you think has been bankrolling the Tea Party?

My Congresscritter, Tea Party darling Mick Mulvaney from SC, introduced 42 bills in one day written to exempt specific chemical compounds from tariffs.  The only beneficiaries were Koch brothers companies.

Educate yourself.  Here is just one tiny example.

Sun, 12/23/2012 - 20:18 | 3091976 hound dog vigilante
hound dog vigilante's picture

Nice logic... that one singular Mulvaney example obviously applies to the entire movement.  

Not sure what Koch bros. are bankrolling, but it isn't the real Tea Party.  MSNBC and YouTube says Koch bros.= Tea Party, so it must be true.  You've swallowed the bait, hook line and sinker.

Sun, 12/23/2012 - 19:19 | 3091892 knightowl77
knightowl77's picture

I don't speak for the Tea Party, but this member supports ending ALL the wars you mentioned, closing military bases and ending almost all Gov't aide.....I want the "Gov't" to leave me alone, completely alone. No matter what else you've heard that is what most of Tea Party that I know supports.............

Sun, 12/23/2012 - 20:26 | 3091979 hound dog vigilante
hound dog vigilante's picture


Folks equating the TP with neo-con/Bush/Palin/warmongers/evangelicals/etc. are missing the target by a country mile...

I believe the TP is a harbinger of a larger/emerging libertarian movement.  Go look at who active military and their families support... the answer may surprise those who think they know what the TP is all about (but don't).


Sun, 12/23/2012 - 10:09 | 3091180 Chief KnocAHoma
Chief KnocAHoma's picture

We'll see ... I wonder how well Obama supporters are goning to like the next depression?Who will hurt more? The poor... like me ... who just want to be left alone to fend for themselves, or the poor that want to be given EVERYTHING?

The rich won't hurt, and Obama hasn't really spent a lot time with real poor people. Oh I know he acts like he gives a shit, but he's too busy mentioning himself and admiring his own reflection to really give a flying fuck about poverty.

Sun, 12/23/2012 - 11:08 | 3091262 Waterfallsparkles
Waterfallsparkles's picture


I think that you WILL find a solution to survive and fend for yourself.  But, the people who have been given everything will not know what to do and may not survive. Their only solution will be to try to take from you what you have.  But, there are a lot of people out there that will show them the error of their ways and means of survival.

Sun, 12/23/2012 - 09:58 | 3091162 Oldwood
Oldwood's picture

Its modern politics. If the dems are the majority and the minority republican don't go along with their plans, then the republicans are evil obstructionists. If the republicans have the majority then the dems are the valiant voice of freedom against Fascism. The republicans lost the battle years ago. The media will decide our future.

Sun, 12/23/2012 - 17:10 | 3091775 hound dog vigilante
hound dog vigilante's picture

dead wrong.  the media's influence is diminishing very quickly.  

only the media itself believes the media has any credibility/weight.


Sun, 12/23/2012 - 02:28 | 3090916 monkeyshine
monkeyshine's picture

Sorry double posted

Sun, 12/23/2012 - 08:47 | 3091105 GetZeeGold
GetZeeGold's picture



Happens to the best of us.....go with God.


Oh and......Merry Christmas.

Sun, 12/23/2012 - 08:58 | 3091119 Tom_333
Tom_333's picture

Expand the depth...expand the balance sheet.....expand away and inflate all other problems.To small tax tax receipts revenue come April....expand the population.....more Mexicans made legal aliens.

Expand on paper and restrict in reality.

Yes of course you have the right to freely arm your self.But you can´t use said arms.Have to be spiked an mounted on wall as decoration.There´s nothing per se in the constitution or bill ot rights clearly indicating that you are entittled to USE your guns.Problem solved.Boehner ,GOP and Joe-Six Pack taken care of.

Don´t believe?I dare you to come up with a problem that can´t be expanded or papered over! Remember you are dealing with Harvard trained attorneys now.

Sun, 12/23/2012 - 10:07 | 3091174 cosmyccowboy
cosmyccowboy's picture

boehner has made the mistake of believing that he is negotiating with a typical politician who is willing to horse trade and not the hard core leftisit that our dear leader is! obama cares little for the stock market and american bz men, only for the leftists that are on his side!

Sun, 12/23/2012 - 11:05 | 3091210 tickhound
tickhound's picture

Mornin' cowboy.  Welcome to zh.  I remember the day my father told me wrestling was fake.  Somehow, I knew it.  Just didn't want to see it. 

Obama cares everything about the stock market.  And so do his friends... and his other friends.  

The so-called "problem" is a LIE, and therefore, the so-called "solutions" (clarity, tax-rates, interest rates, you pick) are also LIES.  The politicians just debate how to fit a square peg in a round hole... the premise being how to maintain necessary growth while maintaining illusion... As both prove increasingly scarce.  The stock market is vital to this illusion.  Especially as the premise proves faulty. 

Most of these politicians actually don't understand the problem at all.  They're not there for that.  Trust me, if they were, things would be much different.  The people we 'choose' are there because they accept the premise as NATURAL.  The jobs they hold depend on the magical religion being REAL.  Some get it but it doesn't matter.  It's not profitable "to get it."  "GTFO kook."

Sunday mornings always start off mellow for me.  Its a good time to clear your head of NONSENSE.  



Sun, 12/23/2012 - 12:00 | 3091359 GetZeeGold
GetZeeGold's picture



I remember the day my father told me wrestling was fake


It is?

Sun, 12/23/2012 - 10:56 | 3091253 GMadScientist
GMadScientist's picture

When you look at the world with one eye closed, you only ever get half the picture.

Sun, 12/23/2012 - 11:07 | 3091269 Oldwood
Oldwood's picture

When you look at the world with both eyes closed you can imagine anything you like!

Sun, 12/23/2012 - 11:38 | 3091321 GMadScientist
GMadScientist's picture

Cutting out distractions often leads to better long-term thinking, but seeing the whole picture keeps you from solving only part of a problem.

I can "imagine":

- not having invaded Iraq

- not allowing multinationals to repatriate foreign profits at lower rate (i.e. not getting paid to not employ Americans)

- not having a mort interest deduction (oh, wait, that's a market distortion in your favor, so it stays, right?)

- not having reduced tax rates since Carter

- not doubling the national debt under one president (twice!)

- not running deficits for decades

- not treating investment gains differently than normal income

- not treating hedgies with special care either

- not bailing out broke corporations of any kind

- not repealing Glass-Steagall

- not conveniently forgetting to regulate derivatives

- not allowing HFT and quote stuffing

- not allowing naked short positions well in excess of yearly supply of a commodity


Sun, 12/23/2012 - 12:05 | 3091374 Uncle Remus
Uncle Remus's picture

- not having a country run by dual-citizens.

Sun, 12/23/2012 - 13:55 | 3091514 Estrella
Estrella's picture

Fredo, you ask:


"Opinion: the GOP may have less to fear than it currently has convinced itself;"


My question to you is, what the heck do the Republican's fear? The battle is over (for at least a few years). They are where they are for at least two years. Do these light weight's "fear" getting a tongue lashing from the MSM? Is that it? I mean, many of us "feared" taking a round in the head. I just have trouble understanding being "afraid" of a chewing out by someone who has no power of you. Big deal.


Bunch of cowards. Really.

Sun, 12/23/2012 - 21:12 | 3092033 Chump
Chump's picture

No offense meant, but who gives a shit?  A bunch of entitled dickholes who pass legislation that doesn't affect them in the slightest, yet we're supposed to hang on their every word and care when "negotiations break down" and resort to analysis like yours over what amounts to drooling lunacy.

How many here have ever had a real, fundamental problem in their lives that absolutely required the valued input of a Congressman?  Of course you haven't, and if you have, fuck you toady.  And yet all 535 of these pissants feel fit to insert themselves in every aspect of our lives, from our toilet paper to our wages (rapidly approaching parity).

"Fiscal cliff."  Pffft.  Hold my beer...

Sat, 12/22/2012 - 20:24 | 3090420 So Close
So Close's picture

This is a precursor to that which is yet to come.... with slightly different roles being played by different actors...

Obama/Bernanke to the Chinese and others buying US Bonds...  "How much will you give us for our latest bond issues..."

China et. al... "You get nothing."

Sat, 12/22/2012 - 23:14 | 3090739 rbg81
rbg81's picture

We don't need the Chinese to buy our bonds with fake $$. The Federal Reserve will happily do that (likewise with fake $$). And no one will say a word.

Sun, 12/23/2012 - 10:58 | 3091256 GMadScientist
GMadScientist's picture

Because diluting the world's reserve currency doesn't have a drastic effect on commodities with inflexible demand or anything.

People all over the world will cry out from hunger and discord.

Sat, 12/22/2012 - 20:47 | 3090458 Oldballplayer
Oldballplayer's picture

It doesn't matter what the republicans put on the table. At the point where they would sign off on the agreement, Obama would pull some bullshit point out his pocket and break the deal.

This is not a negotiation, it is dealing for a carpet in a North African bazaar.

Obama will never negotiate in faith, he wants to go over the cliff. Period.

He is a liar and if anyone had any balls they would call him on it. The problem is that the rest of them are liars too.

We are so fucked.

Sun, 12/23/2012 - 02:11 | 3090912 Buckaroo Banzai
Buckaroo Banzai's picture

Obama was put in place to do 1 job: destroy the United States of America.
We can argue whether he's a Russian agent, a Chinese agent, or an illuminati/NWO agent, but you can be sure of this: he is 100% on board with his mission to wreck this country.

Sun, 12/23/2012 - 03:44 | 3090966 Max in St Moritz
Max in St Moritz's picture

Do you have any evidence of Obama being an agent of Russia? Or is this just more hillbilly nonsense? Could he be an extra-terrestrial?

Sun, 12/23/2012 - 05:43 | 3091040 TPTB_r_TBTF
TPTB_r_TBTF's picture

In 1995 Obama accepted the nomination, signed a contract,[63] and ran as a candidate of the openly Marxist New Party.[64][65]

Sun, 12/23/2012 - 08:46 | 3091104 11b40
11b40's picture

You need some credible sources. This one is from the looney bin.

Sun, 12/23/2012 - 09:05 | 3091124 GetZeeGold
GetZeeGold's picture



Do you have any evidence of Obama being an agent of Russia?


Dude....we have it on tape. It's on You-Tube for the love of Pete.


The NSA and CIA will probably find out about it tomorrow.

Sun, 12/23/2012 - 10:29 | 3091213 11b40
11b40's picture

Oh!  It's on YouTube!  Well pardon me for questioning the Gospel.

Lord have mercy.  It's on YouTube!  That settles it then.

Sun, 12/23/2012 - 10:47 | 3091230 GetZeeGold
GetZeeGold's picture



See how easy?

Sun, 12/23/2012 - 10:54 | 3091249 overmedicatedun...
overmedicatedundersexed's picture you never saw a weapon in your life, fake as obuma's ssn.

Sun, 12/23/2012 - 11:42 | 3091328 11b40
11b40's picture

What are you talking about, dude?  Who is discussing weapons?  You really must be overmedicated.

Sun, 12/23/2012 - 13:02 | 3091438 knightowl77
knightowl77's picture

well from an 11Bravo2PapaHotel you seem like a troll to me

Sun, 12/23/2012 - 19:16 | 3091888 11b40
11b40's picture

1/506th, 101ABN -- I Corp 1970-71.  Primary L.R.R. & Night Ambush Patrols.  Wanna see the pictures, junior?

Sun, 12/23/2012 - 19:24 | 3091896 knightowl77
knightowl77's picture

Yes Old Timer...So you and John Kerry were in Viet Nam. Whoop Dee Doo

2nd/325th Inf ABN, 82nd ABN, you are still a troll

Sun, 12/23/2012 - 21:04 | 3092015 11b40
11b40's picture

I hope your "instincts" were sharper whe you were in the field.

I'm the one on the left ;-)

Sun, 12/23/2012 - 12:04 | 3091362 TWSceptic
TWSceptic's picture

It has been all over the news, on what planet do you live? Obama to Dmitry Medvedev (open mic slip): 'I'll have more flexibility after election'. If Bush would've done that the left would have crucified him for being a traitor.

Sun, 12/23/2012 - 11:01 | 3091259 GMadScientist
GMadScientist's picture

Should've used that during the election!

Sun, 12/23/2012 - 11:58 | 3091353 TWSceptic
TWSceptic's picture

Actually look up the sources, it's true. It's not really a secret that Obama used to be a communist. No one knows to what degree he still believes communism is the way to go. Everything he has done has pushed the US more towards a communist system. Some call it fascist, it depends how you look at it. But one thing is certain: the US is less free than it was four years ago.

Sun, 12/23/2012 - 06:02 | 3091047 Colonel
Colonel's picture

Gee.... the race card whowouldhavethunk it? The world would be a better place if you leftard zombies actually thought for yourselves, now back to your leftard boilerplate/attempts at deflection from the "elite" pyschopath class that you worship.

Sun, 12/23/2012 - 08:48 | 3091107 11b40
11b40's picture

It is you who is playing the race card. What brand zombie are you?

Sun, 12/23/2012 - 08:55 | 3091115 GetZeeGold
GetZeeGold's picture



Not sure....but apparently he's a high ranking officer. I'd give him a little room.

Sun, 12/23/2012 - 06:33 | 3091051 dogfish
dogfish's picture

Obama is our Hugo Chavez.Acts the very same way,just a shade or two darker.

Sun, 12/23/2012 - 10:00 | 3091163 knukles
knukles's picture


By his own words he said that Americans shall be moved to elect him for the dawning of a new life...  That he shall be delivering Miracles.... having promised Heaven on Earth...
The press has cited him as the Messiah...

Messiahs come from the skies>

So, some would think that makes him a self confessed alien extraterrestrial interloper posing as a poor humble Kenyan illegal alien (of the Terrestrial type).

Your view form the mountain lacks a sort of.... "local flavor" to all the horseshit here abouts.

Sun, 12/23/2012 - 10:09 | 3091178 overmedicatedun...
overmedicatedundersexed's picture

.gov is too big they cannot finance with taxes ,, so debt is the tool of big .gov..and many leftist here want every penny they can tax on top of taking on More debt. Fed feeds .gov and .gov protects the money master.

many from left to right see injustice and crimes caused by too big .gov but only the tea party says: NO more $$ to .gov, the left screams more more more ..who is truly nuts? who's actions are to limit .gov, not the left.

Sun, 12/23/2012 - 17:22 | 3091782 hound dog vigilante
hound dog vigilante's picture

"...but only the tea party says: NO more $$ to .gov..."

Exactly right.  Anyone trying to read/perceive any more than this to the Tea Party has an agenda of their own.

Sun, 12/23/2012 - 12:37 | 3091414 shovelhead
shovelhead's picture

I'm still keeping an eye out for "The waters to recede and the Earth to heal."

How we doing on that? I had to take an occasional bathroom break and I might have missed it.

Sun, 12/23/2012 - 10:12 | 3091187 cosmyccowboy
cosmyccowboy's picture

that is why he is so tightly controlled and he never speaks to the public without the teleprompter! on the rare occasion he has gone off it at meetings among leftists of like mind.... when he speaks from the heart it scares the typical american! he cannot let them know what he has in store from them!!!


Sun, 12/23/2012 - 09:14 | 3091132 bigbwana
bigbwana's picture

The man works around the clock. Give him a break. And some holiday. How would you like to be accompanied by an army of guards and a bigger army of press?

Sun, 12/23/2012 - 11:12 | 3091279 Stock Tips Inve...
Stock Tips Investment's picture

It is amazing how our politicians show so little respect for the population. These difficult times demand that politicians are displayed to rise to the occasion. This is not happening. It is affecting the market absurdly. It is affecting absurdly companies have to make decisions. Finally, it is affecting the population, found disoriented in the middle of a big confusion. This is a disaster.

Sun, 12/23/2012 - 14:31 | 3091563 Dingleberry
Dingleberry's picture

So where was this "fiscal cliff" panic last month pre-election? Strangely, this issue has been brewing for at least 5 years, and seems rather "sudden" for my taste.  Think Obama would have got so mcuh support if seniors knew he was willing to fuck them over on social security colas?  The media wouldn't have an agenda, would it? What happened to the 24/7 Trayvon stories? Or the 24/7 gay marriage stories?


Somehow I suspect we will see shooter and repubs-look-like-asses stories around the clock now. 

Sun, 12/23/2012 - 21:35 | 3092067 SanOvaBeach
SanOvaBeach's picture

Eireann go Brach,

Right in there bitch!  Super negativity.  Everything is fucked.  All politicians are assholes.  The whole world is fucked.  This is the super negativity blog and your right in there with all the losers.  109 strong and I'm sure, growing.  I'm not pollyanic.  But give me a break.  Who are you fuck-ups?  Can't look in the mirror, so you blame everything else.  Thunbs-up for the losers!

Sat, 12/22/2012 - 19:39 | 3090330 Silver Bug
Silver Bug's picture

The Debt ceiling will be raised. It is QE to infinity.

Sat, 12/22/2012 - 20:07 | 3090387 King_of_simpletons
King_of_simpletons's picture

At the very least  social security tax will go up 2% for all income groups. Anyone making atleast 50K - 100K  will see 2700-3700 per year increase in taxes. Making more, get ready to pay more in taxes. Investment taxes go up. Dividends taxed as income. Of course estate taxes go up. Gee.... what else......

Sat, 12/22/2012 - 20:23 | 3090418 Luckhasit
Luckhasit's picture

Can't forget the inheritence tax!

Sat, 12/22/2012 - 20:37 | 3090441 knukles
knukles's picture

Don't mess with da Cliff!
It do what it supposed to do

For anybody to be the least serious about "fixing the problem" a little math oriented perspective.

The gubamint borrows about 50% of every dollar spent (Not exact, but close enough for gubamint work... and easy math)
So, let's begin with the following.
To cease and desist any further borrowings (cited as a baseline consideration of a reasonable return to financial sanity) assume that expenditure are cut by 50%  And taxes remain unchanged.

No future borrowings.

Just assume.
Grit the teeth, don't pop a filling... just assume.

That leaves 50% of current expenditures as a baseline for the whole "budget" expenditure for the total US Federal Gubbamin ...

Take that 50% and now allocate it as a scarce resource over all the programs that the federalies have/want... your choice.
Any and all you wanna cut?
Whadday wanna keep?
Go to work.



Just more kabuki theater, Hegelian Dialectic, political horseshit.

Until then, insoluble.


Meaning more of the same, including further downgrades, political gridlock and probably, additional creative Fed policies... which will have to go way past just buying federal debt obligations... 'cause that's already way past the point of diminishing returns due to the reality of a Liquidity Trap.
Which manifests itself as a monetary phenomenon, but the roots of which behaviorally lie in non monetary considerations (Ahem.... Congress and Administration)


Yep.  Start with the "50% solution"

Sat, 12/22/2012 - 20:44 | 3090450 trav777
trav777's picture

the gov can't balance the budget.  If it does the monetary system will collapse.

The big agony for people with giant AUM like Gross is where the fk do I put all this money to earn any yield? 

there's already a shortage of quality bonds.  The Fed has already effectively ORDERED them to deficit at the rate of QE.  If they underachieve that, there will be...trouble.

Sat, 12/22/2012 - 21:56 | 3090595 newengland
newengland's picture

Gold, silver, land. Seemples...if they weren't such pets of Big Brother: ' Lawdy, lawdy, save me. I do believe.'

EG Buffet, Gates and other welfare slaves.

Sat, 12/22/2012 - 22:04 | 3090611 trav777
trav777's picture

gold doesn't produce a fucking yield.

land?  WTF, it doesn't yield shit either.  Not land here anyway.

Sun, 12/23/2012 - 00:49 | 3090853 grid-b-gone
grid-b-gone's picture

Tillable land yields 3% annual rent. Pulp or firewood woodlots average $100/ac per year. Managed saw log timber yields double that, or more.

Timber companies have been at the tax influence game for over 100 years and have had some pretty sweet tax code written on their behalf. 

Gold has no yield, but its 10+ yr run will not end until the printing stops. The counter-argument to gold has been AAPL for the past few years, but I have not seen that point made recently.

Sun, 12/23/2012 - 08:58 | 3091117 GetZeeGold
GetZeeGold's picture



gold doesn't produce a fucking yield.


Neither does Enron or Lehman anymore.


Second question....a yield in terms of what?

Sun, 12/23/2012 - 09:37 | 3091142 francis_sawyer
francis_sawyer's picture

You'd get more bang for your buck from a Tilapia farm than tillable land... (That is, until the county comes along and decides to tax your aquarium)... 

Sun, 12/23/2012 - 09:56 | 3091155 GetZeeGold
GetZeeGold's picture



You can barbecue it, boil it, broil it, bake it, saute it. Dey's uh, tilapia -kabobs, tilapia  creole, tilapia  gumbo. Pan fried, deep fried, stir-fried. There's pineapple tilapia, lemon tilapia, coconut tilapia, pepper tilapia, tilapia  soup, tilapia  stew, tilapia  salad, tilapia  and potatoes, tilapia  burger, tilapia  sandwich.


That.....that's about it.

Sun, 12/23/2012 - 11:04 | 3091263 GMadScientist
GMadScientist's picture

Ceviche and crudo.


Sun, 12/23/2012 - 12:02 | 3091368 GetZeeGold
GetZeeGold's picture



I'm sure Bubba would have come up with it......had he lived that is.

Sun, 12/23/2012 - 11:03 | 3091261 GMadScientist
GMadScientist's picture

You'd get even more bang for your buck with a Coca field or towers of hydro pot.

(that is until the country comes along and arrests you for competing with Pfizer)

Sun, 12/23/2012 - 19:45 | 3091924 IrritableBowels
IrritableBowels's picture

And DuPont.

Sat, 12/22/2012 - 22:51 | 3090703 knukles
knukles's picture

Truth concerning a dearth of US government and federally chartered obligations.  regardless of perceptions, deficits, etc., they're needed in the course of commerce, as well as financial weapons of mass destruction (The latter we can do without).
No yields means no income to millions, no collateral if no obligations...

But Trav, I bring up the 50% concept not as a final final only suggested way to be, an end for all ends... whatever... but as an indica of serious thought being given to the fundamental problem of living beyond a society's means.... attempting to escape the drama of the infinitely immature and insignificant interstices...

Discussions amongst the unfeeling as to 100 million here and a 100 million there are meaningless form the large scope of true effective consideration of problem, of disease as opposed to symptom.

Sun, 12/23/2012 - 01:18 | 3090881 willwork4food
willwork4food's picture

Mabe its cause im slightly buzzed knuk, but i dont' have the foggyest idea of what the fuck your talkin about. Merry Christmas dude! (burp)

Sun, 12/23/2012 - 02:44 | 3090930 monkeyshine
monkeyshine's picture

Our government was not built to be run this way. It was built so that the state legislatures would send Senators that represented the interests of the states (eg, abolish the 17th amendment), and that the House would be filled with men (could be women too though) who attained notoriety in their communities and were selected by their townsfolk to suspend their personal enterprises for a short while and represent the interests of the townsfolk for a few years.

Today it is run by political parties, where men and women are beholden to their leadership for endorsements and campaign money. The adage 'we all answer to someone' was never so apt - even the President now has to rise up through the ranks of his/her party and get the endorsement of the interests that support the parties financially. The problem with money will never get solved until we realize that we have allowed the system to be perverted by 'special interests' (I hate that phrase but it conveys the message). They can't sit down and debate which interests are vital and which can be cut because it is no longer about the good of the country. It is about the good of the party and the good of those that lubricate politics. It wasn't built to run from Washington hell it took a couple of decades before they even built the Capitol city. It was built to manage the interests of the states and the people, not the interests of the country and those who work for it.

Sat, 12/22/2012 - 20:54 | 3090466 dmger14
dmger14's picture

I live in Maryland where O'Malley is jacking up taxes on the rich- defined as families making over $100 k a year.  He has already increased every other tax you can think of!  So we're going to grow our way out of our debt problem with all manner of taxes going up and regulations on small businesses being drafted as fast as the socialists can type?  Biazzaro logic, thesd democrats!

Sat, 12/22/2012 - 21:32 | 3090549 Waterfallsparkles
Waterfallsparkles's picture

The thing with O'Malley is that he hits everyone.  He has a Cell Phone Tax, a Sewer Tax, a Water Tax, a bottle tax, a $75. Chesapeake Bay restoration Tax on your property tax bill.  Now speed cameras that give you a $150. speeding ticket while you are standing still.  Property taxes are thru the roof.   With Baltimore City taxes at $2.38 per hundred of assesses value.  Just a small $100,000. townhouse will cost you $2,300. a year in property taxes.  Heaven forbid you live in an area that your house is worth $400,000.  You will pay $9,500. a year in property taxes.

No wonder people are moving out of Maryland.


Sat, 12/22/2012 - 22:05 | 3090615 trav777
trav777's picture

Baltimore also has that stratospheric crime rate to wash the taxes down with

Sat, 12/22/2012 - 22:13 | 3090626 Ralph Spoilsport
Ralph Spoilsport's picture

Heh, Baltimore. Charm City. Where the debris meets the sea.

Sun, 12/23/2012 - 09:38 | 3091144 GetZeeGold
GetZeeGold's picture



I love a place where you can mine the air for lead.

Sat, 12/22/2012 - 21:42 | 3090570 yogibear
yogibear's picture

Either kick the clown out or move out of the state. People have a choice. 

Sun, 12/23/2012 - 09:47 | 3091151 francis_sawyer
francis_sawyer's picture

Maryland is full of jews [because it's full of Federal Government jobs], so it is inherently a BLUE STATE... O'Malley is just the democrat du jour [as well as being a noteworthy Obama ass kisser]...


Non jews are moving out of Maryland... The only ones hanging around are anyone who is on the state of federal payroll (&, of course, the bottom rung service sector employees to see that the federal employees get their daily scones & lattes)... The rest is a smattering of welfare babies who get entertained by St. Martin's "casino" business [which helps... you know...THE KIDS]...

Sun, 12/23/2012 - 10:48 | 3091227 Waterfallsparkles
Waterfallsparkles's picture

As you said it is filled with Welfare Moms and their countless baby's.  All of the Welfare, child care, Section 8, Medicaid etc. are what makes the Property Taxes so high.

If you Own a Property in an affluent area of Baltimore City the Property Taxes on that one property can support a Welfare Family for a year.

I also agree that O'Malley believes he is being groomed for the Presidency.  He is practicing how to tax everything.

Sun, 12/23/2012 - 10:53 | 3091247 francis_sawyer
francis_sawyer's picture

The funny thing is... The state & federal employees are a bunch of brainwashed liberals... So, most likely, any thought [by them] of having to offset their bloated salaries by having it skimmed off to pay for welfare, doesn't rally move the needle too much for them... They're sure they're doing the right thing in helping humanity...


They all fucking drive Priuses around [you know, because of global warming], have cute little "Choose Civility" bumper stickers on the back of them... &, of course, [DRUMROLL], fully support a ban on guns, but, of course, also the killing of scary brown people by killer drone strikes... They continuously re-inforce these collective ideas by discussing them during their wine party circuits...

Sun, 12/23/2012 - 11:20 | 3091298 NumberNone
NumberNone's picture

Problem is that government employees do no see themselves living off of the taxpayer like a welfare-mom but that's what they are.  The only time this 'I'm a taxpayer bloodsucker' reality hits is when the taxpayer decides to fight back and then that shit must be stopped.  Between all the government employees, ss recipients, and the persons on welfare you are at point where 51% of the voters will never want a cut in government spending.  The taxpayer is fucked and is their bitch. 


Sun, 12/23/2012 - 14:37 | 3091559 Waterfallsparkles
Waterfallsparkles's picture


I polled many friends and they were all Democrats.  I agree that they somehow think that they are doing it for Humanity.  One said that the people on Welfare were not able to get jobs because they were too stupid.  So, society needed to take care of them.  Could not believe my ears.  Yet we pay them for each Child they have.  Why are we paying the people that my friends find to stupid to have a job, paying them to procreate unlimited Children? Some of the friends are the so called Blue Bloods of Md. 

But, as far as killing Brown people with drones, we do not have to worry about that, they are doing a great job in killing each other off. Just read the Baltimore Sun.  Usually 2 or 3 killings a week.

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