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Responsible Fiscal Cliff Resolution

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Budget sequestration kicks in. Initially, automatic $1.2 trillion in spending cuts are mandated. Nominally they're across the board. Obama, most Democrats, and Republicans agree. 

Defense spending will rise, not fall. America's war machine will be generously funded. War profiteers demand it. Bipartisan complicity won't disappoint. 

Social America will be hardest hit. It's longstanding policy. Over the next decade, agreement was reached on cutting about $4 trillion. Before it ends, expect much more.

Social Security, Medicare, Medicaid, and public pensions are prime targets. Other vital social programs are included. Erosion and planned privatization assure eliminating them. 

So does eventually ending virtually all benefits disadvantaged households now get. Bedrock programs will be entirely destroyed. Doing so in their current form comes first. Eliminating them altogether follows.

The annual "doc fix" also expires. Medicare's growth formula ties physician compensation to economic performance. Healthcare providers get shortchanged. Doc fixes minimize damage. 

Unless renewed, physician compensation will drop 26.5%. Doing so assures more doctors dropping out of the program altogether. Many already did so.

The alternative minimum tax (AMT) expires. Annual congressional patches keep it in place. In 1969, it was introduced. 

Initially it was conceived as a system to assure high-income earners, corporations, trusts, and estates pay at least minimal taxes. Currently around 20% of households are affected. 

Thresholds aren't automatically adjusted for inflation. For years, Congress enacted one-year patches. At times, modest inflation relief was included. AMT kicks in if tentative minimum taxes exceed regular ones.

Tentative ones are AMT amounts times alternative minimum taxable income less the AMT foreign tax credit. Regular ones equal income tax obligations minus foreign and possessions tax credits. 

The AMT is a very complicated. It's a parallel tax system. Ordinary people need accountants to determine if it affects them. What began in 1969 is totally dysfunctional. Many middle income earners are hard hit. Nominally it wasn't supposed to be this way.

Patches rectify things annually. Failure to do so assures voter rage. It's been avoided so far. Given bipartisan agreement to destroy America's social contract, anything is possible ahead.

Social destructiveness is prioritized. Doing what's right is spurned. Imagine the difference effective policies would make. Key ones include:

Putting money power back in public hands where it belongs. The Constitution's Article I, Section 8 mandates it.

Public banking works. It's an idea whose time has come. Privatized money power is destructive. Regaining public control more than ever is needed. 

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I was born in 1934, am a retired, progressive small businessman concerned about all the major national and world issues, committed to speak out and write about them.
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According MSN a deal has been reached but no one h... by Bill Johnson on Monday, Dec 31, 2012 at 8:40:15 PM