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Cantor Spells Out Possible Tax Compromise
Wall Street Journal ^ | July 6, 2011 | Corey Boles and Kristina Peterson

Posted on 07/06/2011 12:58:35 PM PDT by Zakeet

A top House Republican leader suggested a way to end a stalemate over taxes in the debt-ceiling negotiations, saying Wednesday that Republicans could endorse ending some business tax breaks targeted by Democrats if they also agreed to renew other business-backed tax benefits.

The proposal by House Majority Leader Eric Cantor (R., Va.), which was described in a briefing with reporters, represents a new wrinkle in the ongoing budget discussions.

In recent weeks, Democrats have pushed for raising revenue by closing a raft of corporate tax breaks and benefits as part of a potential deficit-reduction deal that would ease the passage of a required increase in the federal borrowing limit. Such proposals include tax benefits currently available to owners of corporate jets, yachts, thoroughbred horses, ethanol fuel producers and the largest oil and gas companies.

Until now, senior Republicans have said those measures could only be addressed in the context of overhauling the entire tax code, which most political analysts don't expect this year. Mr. Cantor said he would be open to including closures of such tax benefits as long as Democrats go along with renewing popular business tax benefits such as the research and development tax credit.

Brad Dayspring, Mr. Cantor's communications director, listed several other examples, including extending a one-year payroll tax credit for employees.

It is unclear whether Democrats would go for Mr. Cantor's proposal, or if they would continue to insist that tax breaks for corporations be ended in exchange for the deep spending reductions Republicans are pushing for in a deficit-reduction deal.

(Excerpt) Read more at online.wsj.com ...


TOPICS: Business/Economy; News/Current Events; Politics/Elections; US: Virginia
KEYWORDS: 112th; budget; cantor; debt; federalspending; spending; taxes
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1 posted on 07/06/2011 12:58:39 PM PDT by Zakeet
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To: Zakeet
If my Congressman signs off on ANY tax increase - I don't care if it's employment tax incentives for Pimps training new workers, he's on my sh!t list.

Both of my RINO Senators will bend over at the drop of a hat and they're already on that list - they don't get my vote again (Isakson and Chambliss).

2 posted on 07/06/2011 1:02:17 PM PDT by Gaffer
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To: Zakeet
Cantor preparing us for the eventual cave to the boy king and his "DEMANDS" upon the Congress. Doesn't Congress, just like all other "subjects" have to bow to the boy king's "DEMANDS" /sarc?
3 posted on 07/06/2011 1:04:03 PM PDT by Cheerio (Barry Hussein Soetoro-0bama=The Complete Destruction of American Capitalism)
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To: Gaffer

They will. The GOP ain’t what you think it is. The Titanic is too close to the Berg to alter course in time. If your calculator can accept the numbers you can figure it out for yourself. The goal is to keep the Ponzi scheme going as long as possible.


4 posted on 07/06/2011 1:07:01 PM PDT by screaminsunshine (Socialism...Easier said than done.)
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To: Zakeet

Cantor is a number one a hole, why did the fools at the other end of the state send that joke back to congress after his support of tarp.


5 posted on 07/06/2011 1:12:56 PM PDT by org.whodat
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To: Zakeet
Whether in the minority or majority...

Always..

Always...

ALWAYS!....

ALWAYS!!....

The GOP caves. Bank on it.

6 posted on 07/06/2011 1:14:08 PM PDT by ScottinVA (Imagine.... a world without islam.)
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To: screaminsunshine

Never thought it was...I’m just hoping the new TP congressmen have some integrity. If we keep ousting the RINO GOPer’s and the moderates, maybe we can make some progress.


7 posted on 07/06/2011 1:15:07 PM PDT by Gaffer
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To: Zakeet
In any compromise between good and evil, only evil can profit.

Here's the deal, Cantor. If you do nothing, we get $1.6 trillion in budget cuts. Negotiating will do nothing but reduce the amount of cuts. So essentially, if you work out a deal with the Democrats, we the people get screwed. So do the right thing here. Do nothing.

8 posted on 07/06/2011 1:16:12 PM PDT by Hoodat (Yet in all these things we are more than conquerors through Him who loved us. - (Rom 8:37))
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To: Zakeet

They are all wimps.
Bring on the shut down
Furlough White House and Congressional staffers first!


9 posted on 07/06/2011 1:22:46 PM PDT by AZhardliner
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To: Gaffer

The road to victory lies through the White House. I am hoping Palin is waiting for the GOP to cave on the borrowing limit and then to begin an offensive as a Tea Party Candidate to take the Executive Branch from the GOP/RAT coalition. Now that would be something I could get excited about.


10 posted on 07/06/2011 1:22:51 PM PDT by screaminsunshine (Socialism...Easier said than done.)
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To: screaminsunshine
Claire Wolfe opined that: “ America is at that awkward stage. It's too late to work within the system, but too early to shoot the bastards.”

That was 15 years ago. Maybe it IS time to let lead poisoning retire the politicians responsible for the mess they've made. Think of it as permanent term limits for wannabe tyrants.

11 posted on 07/06/2011 1:23:03 PM PDT by MasterGunner01 (To err is human; to forgive is not our policy. -- SEAL Team SIX)
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To: Zakeet

shocker!


12 posted on 07/06/2011 1:24:58 PM PDT by MNDude (so that's what they meant by Carter's second term)
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To: Zakeet

Mush from another RINO.


13 posted on 07/06/2011 1:26:32 PM PDT by Eric in the Ozarks (Eh ?)
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To: Zakeet
I frankly don't understand the opposition by some Republicans to special interest tax deductions.

Ever since I was active in politics, the conservative position on taxes was to have a low, flat rate with as few deductions and loopholes as posible.

What the heck is going on?

14 posted on 07/06/2011 1:26:43 PM PDT by curiosity
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To: MasterGunner01

Unless Palin decides to mount a campaign as a Tea Party Candidate and skips the GOP Dog and Pony Primary games I am sadly afraid you are right. Palin is the only one who could do it. Juan McClame created a monster.


15 posted on 07/06/2011 1:26:51 PM PDT by screaminsunshine (Socialism...Easier said than done.)
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To: Zakeet
I frankly don't understand the opposition by some Republicans to eliminating special interest tax deductions.

Ever since I was active in politics, the conservative position on taxes was to have a low, flat rate with as few deductions and loopholes as posible.

What the heck is going on?

16 posted on 07/06/2011 1:26:55 PM PDT by curiosity
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To: Zakeet

Mush from another RINO.


17 posted on 07/06/2011 1:27:15 PM PDT by Eric in the Ozarks (Eh ?)
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To: screaminsunshine

It’s not just the place, it’s the ‘who’. We had several years of the ideal government trifecta - House, Senate and White House. They plain ass effed it up. Loser chickenshit RINOs. We won’t win unless we get all three for a number of years so we can pack the judiciary, too.


18 posted on 07/06/2011 1:28:01 PM PDT by Gaffer
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To: Gaffer
If my Congressman signs off on ANY tax increase - I don't care if it's employment tax incentives for Pimps training new workers, he's on my sh!t list.

Why?

19 posted on 07/06/2011 1:28:17 PM PDT by curiosity
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To: curiosity

I’m not for pimps getting tax breaks BTW...it was a symbol of my belief that government (federal government) only has the right to tax in very very limited circumstances. I sent my Congressman to stop anything Obama wants, period.


20 posted on 07/06/2011 1:30:12 PM PDT by Gaffer
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To: curiosity

Problem is the removal of special interest deductions (to wit, localized tax increase) is not balanced by a decrease in overall tax rates.


21 posted on 07/06/2011 1:31:20 PM PDT by ctdonath2
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To: Hoodat
In any compromise between good and evil, only evil can profit.

So you think special interest tax subsidies, like the tax credit for ethonal production, are good?

True conservatives are opposed to using the tax code for social engineering purposes. People like you who oppose the elimination of any special interest deduction aren't conservatives, but idolaters, worshipers of Grover Nordquist.

22 posted on 07/06/2011 1:31:45 PM PDT by curiosity
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To: Gaffer
I wrote my Congresscritter, don't even think about it! I also emailed all my activist pals in the 1st NH.
23 posted on 07/06/2011 1:32:39 PM PDT by Little Bill (Sorry)
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To: curiosity

“Read my lips: no new taxes.”

Violating that is why GWHB was voted out.

Same idea.


24 posted on 07/06/2011 1:32:49 PM PDT by ctdonath2
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To: ctdonath2
Problem is the removal of special interest deductions (to wit, localized tax increase) is not balanced by a decrease in overall tax rates.

You're making the perfect is the enemy of the good.

25 posted on 07/06/2011 1:33:10 PM PDT by curiosity
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To: Gaffer
If Winston Churchill was a modern RINO:

We shall surrender on the beaches, we shall surrender on the landing grounds, we shall surrender in the fields and in the streets, we shall surrender in the hills; we shall never fight.

If you are going to surrender to Obama, please do it early enough so that you can be run out in the primary.

26 posted on 07/06/2011 1:38:54 PM PDT by KarlInOhio (Extremism in the defense of liberty is no vice! Tea Party extremism is a badge of honor.)
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To: Gaffer

I have given up on the GOP. I hope Palin goes rouge and mounts a direct all out attack to take the Executive Branch. I see it as the best chance to save the country. I hope she will get up and running after the GOP cave in on the borrowing limit. Who knows a few TP critters may spunk up and join her to form the new party. It should be obvious the GOP is going to nominate ROMNEY.


27 posted on 07/06/2011 1:39:08 PM PDT by screaminsunshine (Socialism...Easier said than done.)
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To: ctdonath2
Violating that is why GWHB was voted out. Same idea.

GHWB lost because he raised tax rates, not because he eliminated incentive-distorting tax deductions.

28 posted on 07/06/2011 1:39:17 PM PDT by curiosity
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To: ctdonath2

They will call it something else. But not what it is. TAX HIKES. Any guesses on what they call it?


29 posted on 07/06/2011 1:40:49 PM PDT by screaminsunshine (Socialism...Easier said than done.)
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To: Zakeet

Cantor is just another corrupt and incompetent politician.


30 posted on 07/06/2011 1:46:05 PM PDT by mulligan
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To: ctdonath2
Problem is the removal of special interest deductions (to wit, localized tax increase) is not balanced by a decrease in overall tax rates.

Why is that a problem?

As conservatives we want three things: spending cuts, a reduction in tax rates, and an elimination of special interest loopholes and deductions.

Unfortunately, the political reality is we can't get all three of these things, at least not right away. However, we can get two out of three. Why not take them?

Are you seriously saying that we should turn down two things conservatives have wanted for a long time, just because we can't get the third?

I'm sorry, but that makes no sense.

31 posted on 07/06/2011 1:48:45 PM PDT by curiosity
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To: mulligan
Cantor is just another corrupt and incompetent politician.

Getting the dems to agree to $3 trillion in spending cuts in exchange for eliminating a few incentive-distorting tax loopholes that conservatives never supported in the first place seems like a pretty good deal to me.

32 posted on 07/06/2011 1:51:01 PM PDT by curiosity
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To: curiosity
You're making the perfect is the enemy of the good.

You assume that a purported trade of tax breaks for significant "spending reductions" is good. As a short-term expedient, it would be, but for one small problem:

Democrats LIE.

They will institute the tax increases as sure as the sun will rise tomorrow. The proffered spending cuts, however, will NEVER materialize. Why? Because next year is an election year and any proposal to "cut" the budget (Washingtonese for "reducing the originally-planned rate of increase") will be characterized in wall-to-wall Democrat campaign ads as "heartless", cruel", "vicious" , or "merciless": giveaways to the greedy Republican special interests especially those millionaires and billionaires that don't need it.

Compromise is easy, as is demagoguery. Responsibility is hard.

33 posted on 07/06/2011 1:52:14 PM PDT by andy58-in-nh (America does not need to be organized: it needs to be liberated.)
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To: screaminsunshine

I’ll take “investment for $1,000 Alex”


34 posted on 07/06/2011 1:52:40 PM PDT by smithandwesson76subgun (full auto fun)
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To: screaminsunshine
They will call it something else. But not what it is. TAX HIKES. Any guesses on what they call it?

Eliminating special interest tax deductions, which only benefit a tiny fraction of the population, and seriously distort economic incentives to boot, is something conservatives should support, whatever you want to call it.

35 posted on 07/06/2011 1:53:07 PM PDT by curiosity
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To: smithandwesson76subgun

Not bad...chuckle.


36 posted on 07/06/2011 1:54:01 PM PDT by screaminsunshine (Socialism...Easier said than done.)
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To: curiosity

How about. An Adjustment Package?


37 posted on 07/06/2011 1:55:28 PM PDT by screaminsunshine (Socialism...Easier said than done.)
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To: curiosity

Yeah but I want them all gone, not just pick and choose which industry is good and which is evil.


38 posted on 07/06/2011 1:59:01 PM PDT by sheana
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To: Zakeet

I wouldn’t mind getting rid of that tax credit for Hollywood Film Production. They’re all Democrat Liberals anyway. Why subsidize their propagandistic crapola?


39 posted on 07/06/2011 1:59:17 PM PDT by Buckeye McFrog
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To: andy58-in-nh
You assume that a purported trade of tax breaks for significant "spending reductions" is good. As a short-term expedient, it would be.

Economic theory says it is objectively good for the long-run as well.

They will institute the tax increases as sure as the sun will rise tomorrow.

If they win a majority in the future, they will be able to do that regardless of whether we take this deal or not.

The proffered spending cuts, however, will NEVER materialize.

If you really believe that, then there's no point for you to even try to get spending cuts. Is that really your position?

40 posted on 07/06/2011 2:01:11 PM PDT by curiosity
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To: Zakeet

Getting rid of tax bennies like the corporate jet tax bennie - otherwise known as the no-millionaire-without-a-jet-bennie - is not a quote-unquote “tax increase” regardless of the fact that it would probably increase some revenue. It is removing distortions and inefficiencies in the tax code that are, by and large, arbitraged by individuals who either would have engaged in the activity in question anyways - i.e., didn’t need the incentive of a tax bennie - or else engage in uneconomic activities for the sake of capturing the tax bennie - i.e., engaging in distortionary activity.

Most of those items on the list included in the post here on FR - tax bennies on corporate jets, corporate yachts, ethanol production (also known as the starve-a-third-world-kid tax credit) - are stupid, distortionary tax bennies that should be gotten rid of in any event. The class of tax bennies for “the largest oil and gas companies” is too nebulous to weigh one way or the other (e.g., if it’s a matter of getting rid of the depletion allowances for oil fields, that is just silly talk; if it’s some sort of other tax credit, that may be something to get rid of).

In fact, the complaining shouldn’t be that these items are on the cutting block, it should be that plenty of other items, like the R&D tax credit - as well as the so-called green credits that a-holes like Al Gore are merrily milking for their own private gain - are not on the chopping block.


41 posted on 07/06/2011 2:02:07 PM PDT by Oceander (The phrase "good enough for government work" is not meant as a compliment)
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To: sheana
Yeah but I want them all gone,

In politics, as in life, if you insist on getting everything you want, and never settle for anything less, you'll end up getting nothing.

Don't make the perfect the enemy of the good, for we do not live in a perfect world.

42 posted on 07/06/2011 2:04:48 PM PDT by curiosity
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To: screaminsunshine

She said weeks ago that they would raise the debt ceiling, some one was trying to get her to comment on it, they will do what they are going to do. She recognized that what she said would make no difference.

Future comments I am sure will be less muted.


43 posted on 07/06/2011 2:09:45 PM PDT by itsahoot (Fair warning--I will vote for Palin, if I have to write her in. --He that hath an ear, let him hear.)
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To: Oceander
Good post. I agree with everything except your position on the R&D tax credit.

It has been demonstrated empirically that corporate R&D has large spillover effects not captured by the corporation funding it. As a result, without some subsidy, corporations will tend to underinvest in R&D. The tax credit is one way of correcting this problem.

In some sense, we do have a revenue problem, in that we don't have sufficient economic growth. Economic growth, in turn, is mostly driven by innovation. Hence creating incentives for innovation, such as with the R&D tax credit, should be at the top of the conservative agenda.

Of course, there are other ways to consider as well.

44 posted on 07/06/2011 2:11:36 PM PDT by curiosity
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To: curiosity

No matter what you call them people know what a tax increase is, besides the MSM will be there to goad them along.


45 posted on 07/06/2011 2:15:19 PM PDT by itsahoot (Fair warning--I will vote for Palin, if I have to write her in. --He that hath an ear, let him hear.)
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To: curiosity
"What's going on" is....the big lobbyists from Real Estate, banking, etc. (as well as millionaires/billionaires) demand keeping those "deductions" as their way to prosperity and keeping the rest of us paying more as the price for their support.

Time to let Congress know that lowering tax rates is what we're after NOT deductions that many Americans don't use, though lots of us do take advantage of merely as a way to lower our overall rates.

46 posted on 07/06/2011 2:20:33 PM PDT by zerosix (native sunflower)
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To: itsahoot
No matter what you call them people know what a tax increase is

I really don't care what you call them. If you want to call the elimination of special interest tax deductions a tax increase, I'm fine with it, and I support it. I don't worship at the altar of Grover Nordquist, and I'm not interested in semantics.

I unabashedly support tax increases on people who are getting special tax treatment as a result of having bought off some politicians.

Do you really think it good policy to allow hedge fund managers to get away with paying only 15% on their performance-based pay when everyone else has to pay 35% on theirs?

47 posted on 07/06/2011 2:22:54 PM PDT by curiosity
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To: zerosix
"What's going on" is....the big lobbyists from Real Estate, banking, etc. (as well as millionaires/billionaires) demand keeping those "deductions" as their way to prosperity and keeping the rest of us paying more as the price for their support.

You're half right. Special interest groups, such as hedge fund managers, buy off politicians, who then give them special tax treatment. However, it's not the rest of us paying, at least not today. It's our kids who are paying, as these tax expenditures are being financed with debt.

That's why I'm okay with eliminating tax expenditures without immediately lowering tax rates, though, of course, I would take lower tax rates if I could get them.

The trouble is, we'll never get lower tax rates as long as the Dems control the Senate and the White House.

Why not take this deal down, spending cuts and the elimination of some tax expenditures, and then make lower rates a theme of the campaign in 2012?

48 posted on 07/06/2011 2:31:20 PM PDT by curiosity
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To: curiosity
Economic theory says it (a trade of tax breaks for significant "spending reductions") is objectively good for the long-run as well.

Again - if wishes had wings.... it won't happen because Democrats will not ever let it. They have a billion dollars in the bank and an army of union thugs to fight even a reduction in the rate of spending increase. What does the GOP have? Yeah. An army of testicularly-challenged invertebrates. Except for some of the women, strangely enough.....

If they win a majority in the future, they will be able to do that (institute tax increases) regardless of whether we take this deal or not.

What will they do after they have bankrupted the nation? And that is where we are headed - not in some distant future, either, but soon and yes, intentionally (thank you, Uncle Saul!). When the Fed loses control of their near-zero interest rate regime (and they will) our debt service expenses will exceed not only tax collection rates but will consume an enormous quantity of America's GDP. Hello, Greece! You must try our souvlaki. And then some ouzo. Trust us: you'll need it.

If you really believe that, then there's no point for you to even try to get spending cuts.

Please provide me with one example of where Democrats have ever approved a reduction in spending (other than Defense) that lasted longer than one year (oops, there goes Defense, too...).

Enough fun. Look: what we have here is the perennial allegory for American politics: Charlie Brown, Lucy, and the football. Hope triumphs over experience, and frankly - it hurts a little more each time.

49 posted on 07/06/2011 2:36:44 PM PDT by andy58-in-nh (America does not need to be organized: it needs to be liberated.)
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To: curiosity

It’s a problem because it RAISES TAXES.

Regan got suckered into it.
Bush 1 got suckered into it.
Other (R)s got suckered into it.

Every time a tax increase of any kind anywhere is accepted by Republicans as a precursor to overall tax reductions, the overall tax reductions NEVER HAPPEN.

You think your income tax rate will be decreased in return for eliminating your mortgage deduction?
You think spending will be cut and tax rates reduced in return for eliminating deductions?
...you haven’t been at this game for long, have you?

If you agree to an increase in taxes ANYWHERE, they will NOT decrease spending or rates. PERIOD. Proven over and over in US political history. They win, they get more money to spend, they have no incentive to cut spending.

Refuse to raise taxes, anywhere, at all, and they MUST cut spending somewhere - because there will be no money to spend (eventually, even borrowed or printed money).

NO NEW TAXES.
NO RAISED TAXES.
DRAW THE LINE ALREADY.
Or get suckered into the same trap again.


50 posted on 07/06/2011 2:42:16 PM PDT by ctdonath2
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