Geithner: ‘I Can’t Promise’ U.S. Won’t Go Over Cliff

[DonViejo]

Source: TPM



PEMA LEVY 9:34 AM EST, SUNDAY DECEMBER 2, 2012

Treasury Secretary Tim Geithner said he can't promise that the United States won't go over the fiscal cliff, during an appearance on "Fox News Sunday."

"No, I can't promise that," Geithner said. "That's a decision that lies in the hands of the Republicans that are now opposing increases in tax rates."

Geithner argued that the only reason the country would go over the cliff was if Republicans refused to allow tax rates for the top two percent to go up. Once they accept that, he said, there is a basis for a deal.

On going over the cliff, Geithner said it would be "very damaging to the average American."

-30-

Read more: http://livewire.talkingpointsmemo.com/entry/geithner-i-cant-promise-us-wont-go-over

[Garion_55]

1. i think that we have to go over the cliff

at least for a couple days. after that happens congress can vote on a tax cut for 98% of people and all the republicans can still support that without being unfaithful to norquist.

[jtuck004]

2. We went over the cliff when you had lunch with your first banker and decided you liked them

better than the rest of us, back then.

I doubt you will ever go over "the cliff". Not really.

[heaven05]

3. Thelma and Louise!!!!

here we come?!!!!!!!?? damn the torpedoes, full speed ahead!!!!!!!!!!!!!!!!!

[BlueStreak]

4. What will the MSM narrative be on Jan 2

After we have gone over this horrendous, cataclysmic cliff and cities are still standing and life continues to go on more or less as normal?

At this point, it is obvious the GOP doesn't want to do any serious deal. The best option is to let everything lapse on January 1, then come back with A proposal for TEMPORARY extension of the tax cuts for incomes under $250K. It is absolutely reckless of Obama and Geitthner to offer a permanent extension of those cuts. That only funds government at 17% of GDP, and we need 22% of GDP. Making any of the Bush tax cuts permanent means that the GOP wins in their goal of killing all the parts of our government they don't like.

[democrattotheend]

17. Where do you get the 22% figure?

What makes you say govt. spending has to be 22% of GDP?

[BlueStreak]

18. It has been around 22-24%

It can possibly get to 20% with growth in the private sector, but seriously, there isn't THAT much room for growth without sending us into very heavy inflation. We're growing in the 2-3% range. We can't grow in the 8% range.

With growth, the tax revenues might get up to 18% of GDP without fixing the taxation problems. In other words, we are in a structural deficit situation, and making the middle class tax cuts permanent will only lock in that problem.

The better policy is to eliminate the Bush tax cuts for the rich today, and gradually phase them out for everybody else based on economic triggers (unemployment hitting 7%, 6%, 5%, etc.) As unemployment approaches 5% wages will go up so people will be in a better position to pay the "Clinton" level of taxes.

[iandhr]

5. Isn't medicare part of the automatic cuts?

Last edited Sun Dec 2, 2012, 05:02 PM - Edit history (1)

[onehandle]

6. Good. Hit the gas. nt

[Trillo]

7. It won't be just as damaging to the super-rich?

"very damaging to the average American."

[Gregorian]

8. More crybaby criminal scare tactics. We're in better shape now than before. There is no cliff!

[Gregorian]

9. THERE IS NO SPOON!

[and-justice-for-all]

10. Fine, I am good with that...

then we still win. Because they will have to come back and adjust the middle-class and poor tax rates separately and there will be no dealings on that issue.

[SoapBox]

11. "...Geithner said it would be "very damaging to the average American."

Specifics, Specifics, Specifics!

I'm OVER all the BOO! tactics by both sides.

For us lowly, low income types (compared to the 1%), what EXACTLY are we looking at?

...SS rate returning to what it was.

...Fed tax rates going up, some.

and what else?

I love the 1%er's rates going up and cuts to the Pentagon.

Again, what else besides BOOOOOOOOO!

[dixiegrrrrl]

13. What are we looking at..just ONE aspect of it..

Less revenue to the gov't and higher debt load means at some point gov't cannot sell its debt, which is Treasuries, which are what Soc. Sec. is supposedly funded by.
Thus less money to pay Soc. Sec. recipients.

The payroll tax decrease has meant less money going into the Soc. Sec, fund, while more people are becoming eligible for Soc. Sec.
Thus less money to pay Soc. Sec. recipients.

Less revenue and higher debt load means other countries do not trust the dollar.
We will have no more credit and no more money as far as other countries are concerned.

If it comes down to cutting the military budget or cutting income and medical services to seniors, which do you think the current government will do?

Of course Geithner said "the average American"
He is a Goldman Sachs guy and will always have a cushy job at some big bank.

[msongs]

12. timmy you could resign. that would be a first step nt

[Nonhlanhla]

14. I'm worried about this

I'm not sure if I understand the whole thing very well (I do understand the basics of what will happen at the end of the year if no deal is struck). But it sounds more and more as if both sides are saying we're going over the cliff. Now from what I hear us middle class types will face thousands of dollars more in taxes as a result. For the rich an extra $2,000 or $3,000 may not be much, but for me it's a lot, and I know we cannot really afford it. So I guess the plan is to let us go over the cliff, then push for middle class tax cuts after Jan. 1, and hope Congress passes it? What are the chances the Grand Old Obstructionist Party will play along? After all, we all know they are only for tax cuts if it is for the wealthy.

[ieoeja]

15. And yet, somehow we managed before the holiday. And have only had ten years to prepare since.

The problems are three fold, and largely caused by the 2010 extension.

2001 Bush holiday - should have ended in 2011.
2003 Bush holiday - ends in 2013.
2009 Obama holiday - ends in 2013.

Obama never should have added the SSI tax holiday in 2009 in the first place. And because of the 2010 extension, all the holidays end simultaneously. They should be phased out just like they were phased in. Then, just like most of us never even noticed the holiday when it started, most of us would not notice it when it ended. Ending them all at the same time will come as a sticker shock.

I would give a one year extension to the 2003 holiday and let the rest end. Then we will be back to normal in 2014.


On edit: the "third fold" was a gradual change of the Alternative Minimum Tax. This was also only temporary and expires this year. This change should probably be made permanent and the whole thing attached to inflation. Obama actually wrote that into his 2011 budget, but like everything else, Republicans refused. That is going to be a huge problem for a lot of people by April 15th if not fixed. Unlike the regular tax holidays, this change could mean many thousands of dollars in one instance for people who probably don't have many thousands of dollars lying around. The regular tax holiday is much lower and spaced out over the whole year.


Two years ago everybody in Illinois was ranting and raving the exact same doom & gloom we hear today when Gov Quinn wanted to raise state income taxes from 3% to 5%. Nowadays when I remind people of this, the usual response, even from GOPers who were among the loudest screamers is, "I had almost forgotten that; when is that tax increase supposed to start?"

It started two years ago. They hardly even noticed at the time. And completely forgot almost immediately.

[Nonhlanhla]

16. I'm not against ending all the tax cuts

I'm a Dem - per definition I believe in taxes, LOL! So I'm not against ending some of these tax cuts. I am all for ending the tax cuts on the really wealthy (and I would be even if I were wealthy). I'm also for ending the payroll tax cut. But somehow I don't think the pay roll holiday in itself will make the "several thousand dollars" difference for middle class families that is projected. But overall I don't want to see regular taxes on the middle classes raised: it would be bad for the economy because middle class spending carries the economy; and it would be really hard on families who have not seen much (if any) increase in income for several years.

As I said, I'm not sure that I understand this whole thing well. I just know that things are tight, and there isn't that much that we can cut in spending to make up for such a huge difference.

Thanks for responding.

I guess I'll just wait and see what happens, and then suck it up.

[skrempi313]

19. They Have To Come Up With A Better Proposal

http://www.dailykos.com/story/2012/12/03/1166924/-White-House-shoots-down-House-Republican-proposal-on-fiscal-cliff