No need to wait on Obama tax increases, the state of California is pushing right ahead with its doozy Prop 30, resulting in sizable sales and income tax increases. Democrats also grab a two-third super majority in the California Assembly.
Lots of zombies have been sedated to get through the election. Now the promises made to defer real problems will come home to roost, ranging from Greece to Iran to US fiscal trainwrecks (I hate the misleading term cliff).
Interestingly eight of the ten wealthy counties in the US think it is business as usual as they voted for Obama. Didn’t Obama campaign largely on the face of higher taxes on the wealthy? One of the promises Obama made to rustle up Hispanic votes, was major immigration reform. Hard to see the GOP, a party of old, white men going along with that one? I’ll trade you one Hispanic friendly immigration bill in exchange for tax breaks on the rich and raise you one?
Sen. Elizabeth Warren’s election is excellent in my book. Once again we will see if Hopium listens to Larry Summers and keeps her off the Banking Committee and sends her off to some Siberian isolation instead. The Forestry Committee would be par for the course.
Fitch was clear in comments on CNBC that they needed to see a grand bargain and a credible fiscal plan and not can kicking for the US to avoid a downgrade. The Fitch spokesman said printing money is not a substitute for sustainable fiscal policy.
Harry Reid all but said that nothing serious would take place during the lame duck session. John Boehner asked for a down payment now, but pushed for complex tax reform rather than higher tax brackets. This points to kicking the can down the road until the first half of 2013. Not a word out of Obama.