Let's see… The dollar is hitting new lows as I write this morning, and oil is hitting new highs. The fiat currency in my wallet are becoming more worthless with each passing hour, and the fuel that powers my modern lifestyle is becoming ever-more expensive. And then… on top of all that… I see this cheerful news:
For the first time since 2001, it’s not clear that Congress will pass an annual temporary “patch” in time to prevent the creeping Alternative Minimum Tax from forcing up tax payments for millions of unsuspecting middle-class taxpayers.
In addition, if Congress doesn’t “patch” the AMT tax within 10 days — and it appears highly unlikely to do so — then the partisan bickering among lawmakers could delay tax refunds next year for tens of millions of Americans.
The article goes on to explain that Senate Majority Leader Harry Reid has other priorities for the next few days and as a consequence, the IRS can't finalize its forms and instructions. And as a result of that, refunds would likely be delayed for folks who file by March 31, 2008.
So what's the holdup? Part of it is the Democratic party's uniquely cracked view of fiscal responsibility. Back when spendthrift Republicans ran Congress, they did short-term fixes of the AMT each year without paying much heed to the fact that those short-term fixes brought down the Treasury's total projected revenue. The deficit simply got bigger. But in the blinkered minds of Democrats, anything that brings down the Treasury's total projected revenue is a "tax cut." And "tax cuts" in one area must be offset by tax increases in some other area. This is what's at the heart of the debate right now over compensation for hedge fund managers and whether it should be taxed as capital gains or ordinary income. It's all about "offsetting" the "losses" from fixing the AMT.
Are you still with me? If not, don't feel bad. All of this is intended to confuse and obfuscate, so that we lose track of the real issue here that neither party is willing to address — government spending is simply out of control. Democrats think any tax cut in one area has to be accompanied by an increase in some other area. But spending cuts? That's out of the question. And Republicans aren't any more amenable to spending cuts, either, so the taxes they cut become debts passed on to future generations. (Bush partisans, please spare me comments about how the deficit is coming down. All that matters is the national debt, which has grown 65% on his watch.)
This is what passes for a "choice" in electoral politics these days. We're screwed.