Norquist pledge can send us over the cliff
If those who signed it believe compromise is heresy, we will end up with no budget deal.
The Republicans who signed the no-tax increase pledge -- the one put together by anti-tax strategist Grover Norquist -- have no room to maneuver when it comes to compromising to avoid the fiscal cliff.
Norquist is the real force behind the Republican Party's strategy when it comes to the talks to avoid the cliff. He has made it clear to anyone who signed the pledge, and that's pretty much every Republican, that they will be embarrassed and shamed out of their "impure" thoughts. They will be forced to get back in line, or risk being outed as closet Democrats who favor bigger government and higher taxes.
In other words, those who signed an allegiance to Norquist have no choice but to send us over the cliff. They are duty-bound to do so, frankly, regardless of whether they like it. They took the pledge; they have to swallow the cliff medicine.
Unless the pledge is broken by those who signed it, there won't be enough votes to put through a package to avoid the cliff.
Put aside for a moment the issue of whether you hate President Obama or like him. I know, I know -- that's virtually an impossibility these days. But accept the view that the president will not accept any deal that does not have tax increases.
Then accept that Norquist, who is by far the most powerful ideological force behind the Republican Party, will not allow those who signed the pledge to get out of it without a promise that they'll be fired by their constituents.
Assuming these two factors, there will be no choice. We will have to get the onerous austerity package -- the one that was created to give us Spain-like budget cuts and tax increases -- even though we are nowhere as profligate and anti-tax as the Spanish had been before their forced cliff jump.
Now, I am sure many of you say, "Wait, why doesn't the president have to give? Why doesn't he have to surrender to Grover Norquist, too, in order to get a deal done? Why doesn't he have to bend his will?"
Don't laugh, but when I pulled up with Norquist, an old acquaintance from college, he marveled at how obtuse the president was not to see that we need to prevent tax increases. He appears to believe that, if the president were to sign the no-tax-increase pledge and then go with the program cuts wanted by the Republicans, there will be no deficit and the U.S. will grow to the sky.
That's my summary of Norquist's view, whether Norquist thinks that's accurate or not. You can't help but draw that conclusion.
Here's the issue with our obstinate president. He campaigned and won on a pledge to raise taxes and cut spending. Norquist didn't campaign. He didn't win. The president is all hung up on his pledge -- the one that the voters agreed with.
The fact is, again, regardless of whether you like him, the president has said he will be willing to cut spending. He awaits the Republican anti-spending plan. If they propose one, I think he will agree with some of it, provided that the Republicans agree to some tax increases. It is called "compromise" where the president comes from.
Where Norquist comes from, it is called "heresy." No compromise is allowed. That, to me, is why the only hope for a deal is to have the pledge broken in favor of avoiding the fiscal cliff. Norquist doesn't care about the consequences of the cliff; he cares about exacting the consequences of violating the pledge.
I think we have to stop obfuscating. If you think the no tax-increase-pledge must be upheld, then you can't believe in compromise. If you can't believe in compromise -- which, in this case, would mean tax increases and spending cuts -- then enjoy the cliff jump, because it simply must occur.
I'll have more on what that world looks like later in the day. But let's just say that, if you like stocks going higher, you want the pledge broken. If you want them lower, then go with the pledge.
Jim Cramer is a co-founder of TheStreet and contributes daily market commentary to the financial news network's sites. Follow his trades for Action Alerts PLUS, which Cramer co-manages as a charitable trust.
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I was never for NAFTA...IT has hurt us some by losing production and/or manufacturing within our borders of particularily "durable goods"...
The other Trading Regulations are somewhat helpful, sometimes discouraging....?
I am somewhat more uncomfortable with China and parts of the Pacific Rim entities wanting to enter agreements with the Americas; ie, Canada, U.S., Mexico and S. America(Brazil/Argentina/Vens).
I think that would/could have a far more devastating effect to us...
Can't remember name of Policy or Agreement, but it has come up more then once and the U.S. Policy makers don't care for it...But I believe our neighbors to the North are all in favour of it.
But becoming a "Protectionist's Country" at this time in our History would probably destroy us.
It has devastating affects on "most" Countries, that have tried it, in History of the World.
I am astonished that a non-elected individual holds the Republican Party and Congress hostage.
It shows how far removed we have become from our roots. Selling your soul to the devil! No guts!
What a bunch of cowards. I thought the country came first. Norquist can kiss my ****!
I don't care what any of you idiot liberals say. Obama is fighting for the rich man as much as the T-party republicans. He's fighting for something that won't dent the rich people - Higher percentage tax but same old laws and loopholes.
The republicans are just as bad --- offering tax code changes only knowing that Obama will not accept them......... You're used liberals..... just like your conservative brothers before you with Bush........ YOU'RE USED.
MIRAGE GUY;You should change your screen name to MIRAGE BRAIN, because we`ve
still looking for your brain.I think you lost it when you were flipping burgers at McDonalds
a couple of months ago.
Poll after poll has indicated that about sixty percent of the American people want the temporary Bush tax cuts to expire on the most fortunate and wealthy members of our society with the highest incomes. Yet the Republicans have signed a no-tax pledge to Norquist and the Republican billionaires who finance his operation not to let the temporary Bush tax cuts expire on the top 2.9% of Americans with the highest income. As a trend, this top 2.9 % of federal income taxpayers are paying the lowest effective tax rates that they have paid in decades, going back to at least 1990.
The Republican U. S. Senators and U.S. Representatives, who signed the pledge, their allegiance does not lie with the American people, their allegiance is to Norquist, to his pledge and to the Republican money-men who have bought and paid for his operation. The money-men are, after all, the primary benefactors of the Norquist operation which they finance.
How about some people who live in the real world.Lobbyists don`t represent 99%
of us.Norquist is what`s wrong with the Repubs.
NTU: Let's not beat the drum against free trade without the surrounding facts.
What was the unemployment rate in the years following NAFTA's approval? Here's what I see:
1993, 7.3%, 94: 6.6%, 95: 5.6%, 96: 5.6, 97: 5.3%, 98: 4.6%, 99: 4.3%, 2000: 4.0%, 01: 4.2%
Wages? Here's the average wages for production and non-supervisory employees
93: $374.9, 94: $385.62, 95: $396.41, 96: $400.87, 97: $421.55, 98: $442.53, 99: $459.49, 2000: $473, 01: $488.72
Still think NAFTA caused a lot of unemployment and wage problems? The stuff we outsourced ended up getting replaced by things that paid better because it was higher value.
You're goddamn right...DLH, it is sick...Those people should not have been in Benghazi...That was stupid....The Ambassador was a ladder climber and the Contracted Security were making $100s of thousands a year....IT WAS GREED & EGOs THAT GOT THEM KILLED..nothing less.
And I won't back off my statements...IDIOTS are making a big deal out of almost nothing.
Whether you have been in a War or not, doesn't matter too me. BUT people DIE just because of the term...And the Majority of them are "innocent victims." or put in Harm's Way, by others that don't really feel the sorrow, unless it directly affects them...Which in most cases, is the case.
If you are not against our stupidy in the Middle East.....YOU ARE THE PROBLEM.
We are not talking about "taxing" the Rich at 90% or even 50%....Those types of taxes have been gone for decades.
What we need is a fair an equitable tax on Income,dividends and interest or profits...
It is not right for the Middle Class to pay 20+% percent, while making maybe $50-60,000.
And a multi-millionaire pay maybe 10% on all money coming into their pockets; Because they have tax-cheating Accountants and Lawyers...
And that does not include investments and accounts;....HIDDEN OFF SHORE.!!!
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All hail the bull market, which ended the week with a big rally. But it also is starting to look a little like 1987, which suffered an epic blow-out.
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