Conservatives urge GOP leaders to be bold, prepare to go over cliff

Obama_BoehnerFrom, By Erik Wasson – 12/23/12 06:00 AM ET – Conservative activists who helped doom Speaker John Boehner’s (R-Ohio) “Plan B” say Republicans must be prepared to go over the fiscal cliff to force President Obama to reach a deal that includes no tax hikes.

The activists say Boehner and other GOP leaders have been too scared about suffering politically if the nation goes over the cliff and $500 billion in tax hikes and spending cuts are triggered in January.

“I think Obama is very mindful of his legacy and is horrified of going over the cliff,” said Andy Roth of the Club for Growth. “Going over the cliff might be a signal that needs to be sent to the president, that he needs to play ball.”

He argued that President Clinton was forced to become a less liberal president after Speaker Newt Gingrich shut down the government in 1995.

“Clinton would not play ball with Newt until Newt shut the government down,” Roth said.

Several polls, however, suggest Republicans are in danger of being blamed by the public for a failure to prevent the tax hikes and spending cuts.

A Pew Research Center survey out last week found that 55 percent of those surveyed say Obama was making a serious effort to solve the fiscal cliff problem, but only 32 percent said Republican leaders were doing so.

A Wall Street Journal/NBC News survey found that 65 percent of those surveyed view the GOP negatively compared to 35 percent who view the Democratic Party negatively. That poll found 24 percent would blame the GOP if the fiscal cliff occurs, compared to 19 percent who would blame Obama.

It also is not conventional wisdom that the GOP benefitted from the government shutdown fight between Clinton and Gingrich. Some argue the shutdown backfired and led to Clinton’s reelection in 1996.

Conservatives also argue Republicans will see their brand diminished by agreeing to anything that could be labeled a tax hike.

Boehner’s bill would have extended Bush-era tax rates on all annual income under $1 million, but conservatives said it raised taxes since rates on income more than $1 million would have gone up.

“I think it is certainly better to go over the fiscal cliff than to have the Republican party deny the American people to have one party that stands for lower taxes and another party that doesn’t,” Michael Needham of Heritage Action said last week.

Freedomworks initially backed Plan B as a negotiating tactic but reversed course last week and, like the Club for Growth, announced it would score votes on the legislation.

“The worst thing that Republicans can do is raise taxes,” Matt Kibbe of Freedomworks said Friday. “If Obama wants to raise taxes he can do that but Republicans shouldn’t give him cover.

“If Obama wants to go over the cliff, let him own that,” Kibbe said.

Roth argued Republicans should be willing to stretch the fight into 2013. Economists argue the ill effects of allowing tax hikes and spending cuts to go into effect will grow over time as more money is taken out of people’s pockets.

“They could take this into the New Year and extract a lot of very pro-growth entitlement reforms but I don’t think they are willing to go that far,” added Roth.

“The best thing we can do is extend the current rates for six to 10 months while we get pro-growth tax reform. The president is the only one who can propose that,” said Kibbe.

Dan Holler of Heritage Action said that Republicans now need to sell Medicare premium support and other bold ideas to get them into a fiscal cliff solution.

“When is the last time you heard Republicans make the case for Medicare premium support?  When is the last time you heard Republicans talking about ending cronyism in the tax code?  This is what Republicans need to focus on and commit to in the coming weeks and months. Until they do, no deal will be worth cutting,” he said Friday.

For America Chairman Brent Bozell on Friday released a plan for the GOP that involves it increasing its demands of Obama in fiscal cliff talks.

“Speaker Boehner, working in conjunction with Senate Minority Leader McConnell, should craft legislation that gets us on the road to fiscal sanity. This agenda must include four key items: cutting the corporate tax rate, abolishing the immoral “death tax,” real spending cuts, and serious entitlement reforms,” he said in a statement.

“Bring a united GOP front and challenge the president to support this legislation. Offer him the ‘millionaire tax’ if he will. If he doesn’t accept this, it proves he’s not serious. At that point the GOP should walk away, declaring it’s the president who now owns the impending disaster,” he said.

One response

  1. Senator_Blutarsky

    We have ” bagmen ” in Austin & DC, not statesmen. The system is totally corrupted thank to an unchecked lobbying presence and no term limits……but they all love Jesus and like to tell us what “conservative Republicans” they are…

    By Greg Hunter’s

    What has been going on in Washington, D.C., since the financial meltdown of 2008 has been a disaster for the country. Taxpayers bailed out crooked, incompetent bankers while tens of millions lost their homes and jobs. The bailouts have cost trillions of dollars, and they’re not finished. The Federal Reserve has set a key interest rate to near zero percent until 2015, and it is printing $85 billion a month to prop up the banks and our own government. The Fed calls this little operation “open-ended.” No one has gone to jail for causing this enormous hardship on ordinary Americans, and not a word is spoken in the halls of Congress about stopping the bailouts or bringing criminals to justice. This is immoral, disgusting, repugnant, nonexistent leadership.

    This could have been handled in 2008 with the debt wiped clean. We should have only protected depositors. Bankers, bondholders and shareholders be damned—that’s capitalism. It would have cost about $6 trillion back then, and we’d be on our way to a real recovery by now. That is exactly what Iceland did. It told bankers, shareholders and bondholders to take a big hit instead of giving a bailout for incompetence and fraud. Oh, and it prosecuted the bankers and government officials that allowed the implosion to happen! (Click here for more on Iceland’s turnaround.) Instead, the Federal Reserve alone pumped out $16 trillion in the wake of the 2008 meltdown. That is only part of the banker bailout that is still going on to the tune of $40 billion a month. Not a single financial elite has been prosecuted and put behind bars for obvious crime and fraud—not one!

    Meanwhile, the dog and pony show called the “fiscal-cliff” is playing out like a gigantic blame game. All we have to hear is the splat for the finger pointing to kick into high gear. Both Democrats and Republicans are to blame for not standing up and making the hard choices to put the country on firm financial footing. They may act stupid, but I believe they know full well what’s going on. Renowned gold expert, Jim Sinclair, has a saying for things like this, “It’s too stupid to be stupid.” Meaning, it’s intentional.

    Our own elected leaders turn a blind eye and a deaf ear to fraud and crime year after year. The government also allows the banks to value assets at whatever they think they will be worth in the future. This government sanctioned accounting fraud has been allowed since April of 2009. Meaning, the Fed can’t print money fast enough to fix the gigantic mess. Meanwhile, the Federal Reserve continues buying $40 billion a month in “toxic” mortgage debt created by the bankers. This stuff was supposed to be “Triple A” rated debt, equal to the “risk free return” of Treasury bonds. Imagine the government selling you Treasury bonds and later tell you they are “toxic.” Wouldn’t that be outright fraud? You bet it would, and yet not a word from our leaders about the Fed buying this junk at a rate of $40 billion a month to infinity. JP Morgan Chase just paid nearly $300 million in fines to settle fraud charges brought by the SEC. JP Morgan paid a $150 billion fine last year for the same thing. Other big banks are also guilty of fraud in the mortgage arena. Why isn’t Congress holding hearings? Why isn’t the Justice Department handing out indictments? Oh, we did get a deal on the “robo-signing” fiasco that let bankers off the hook for foreclosure fraud and perjury. Thanks, Congress, for letting your campaign donors, I mean bankers, slide again.

    The LIBOR (London Inter-Bank Offered Rate) rate rigging scandal is another enormous fraud on a global scale. LIBOR sets rates for as much as $800 trillion in transactions worldwide. More than a dozen big banks are involved in rigging this rate, and what are they getting for punishment? Most recently, UBS was hit with a $1.5 billion fine. Why aren’t there indictments and Congressional hearings to get to the bottom of this rip-off?

    How about money laundering for Mexican drug cartels and terror groups that HSBC recently admitted to doing over several years? Where’s the outrage? How about some criminal charges? Why isn’t Congress pressing the Obama Administration for answers just like the “Fast and Furious” gun running scandal? Isn’t laundering billions of dollars for drug cartels and terrorists worthy of a little attention by our government? HSBC CEO Stuart Gulliver did admit to “stunning failures” and said, “We have said we are profoundly sorry for them, and we do so again.” (Click here for the complete story from Reuters.) The CEO is “profoundly sorry”? How about profoundly guilty of crime against this country!!

    Let’s go back to the so-called “Fiscal Cliff.” Everybody in Congress knows what the real story is. The U.S. takes in a little more than $2 trillion in taxes, and it spends a little more than $3 trillion. The real deficit for last year alone was $7 trillion (if you count everything) according to John Williams of I am talking about the same accounting the government requires of business called GAAP (generally accepted accounting principles). Fixing this mess means we will have to spend a lot less and, yes, taxes will have to go up. This will be very painful for everybody, and I mean everybody. The rich, the poor, the young and old will have to suffer to fix this mess. It will take years, and we will not just “grow” our way out of this one. We’ve been told the “growth” lie for years, and the only thing that has grown is the debt and deficit of the U.S. If we don’t fix this mess, then that pain I’m telling you about is going to be much worse, and our very country will be at great risk.

    There’s not a word about the real financial problems of the country with the “Fiscal Cliff” negotiations from either party. As Mr. Sinclair says, “This is too stupid to be stupid.” I say, in Washington, D.C., we have bagmen, not statesmen. For this, the country will pay dearly.

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