The Federal Reserve plans to keep short-term interest rate near zero until unemployment drops below 6.5 percent and inflation reaches 2.5 percent. This means given the current equations used to calculate those numbers, Fed interest rates will remain at current lows until mid-2015 or beyond.
The Fed will also continue spending $85 billion a month on bond purchases to keep long-term borrowing costs low and to stimulate the U.S. economy. They will also spend $45 billion a month on long-term Treasury purchases and continue buying $40 billion a month in mortgage bonds.
Why are such moves deemed necessary by the Federal Reserve?
Why does the U.S. debt ceiling need to be raised every few years?
Why is America stressed about a “fiscal cliff?”
Because the United States of America spends entirely too much money.
To those who remember history, it is self-evident that politicians, elected or not, who subscribe to the “progressive” (read Marxist) philosophy have little to no interest in compromising with their political opposition. History informs that “progressives” in America are more inclined to attempt eliminating their Conservative political opposition than reaching any compromise. How else can it be explained why “progressives” continue to cling to their uncompromising position?
The so-called fiscal cliff negotiations going on in Washington DC is a clear example of their motives and tactics.
The “progressives” are intentionally holding to a position untenable to Conservatives in hopes of creating divides within the GOP and causing them to lose credibility by caving on their principle of not raising taxes.
The best case scenario for “progressives” is for the GOP to stick to their principles and refuse to raise taxes. Then “progressives” and their co-conspirators within the “mainstream media”, aka the “progressive” Party Pravda, can place the blame for the economic results of sequestration on Conservative Republicans while, solely for their own political aims, temporarily championing members of the GOP who appeared willing to “compromise.”
Trying to negotiate a “grand bargain” simply means Republicans are aiding and abetting “progressive” Democrats in their quest to commit the biggest swindle in American history.
Senator Rand Paul (R-KY) has a better idea that is good strategy for countering “progressive” actions:
I have yet another thought on how we can fix this. Why don’t we let the Democrats pass whatever they want? If they are the party of higher taxes, all the Republicans vote present and let the Democrats raise taxes as high as they want to raise them, let Democrats in the Senate raise taxes, let the president sign it and then make them own the tax increase. And when the economy stalls, when the economy sputters, when people lose their jobs, they know which party to blame, the party of high taxes. Let’s don’t be the party of just almost as high taxes.
In the House, they have to because the Democrats don’t have the majority. In the Senate, I’m happy not to filibuster it, and I will announce tonight on your show that I will work with Harry Reid to let him pass his big old tax hike with a simple majority if that’s what Harry Reid wants, because then they will become the party of high taxes and they can own it.”
Conservatives can keep bashing Speaker of the House John Boehner and House leadership, perhaps Senate Minority Leader, Mitch McConnell. But that does absolutely nothing to advance the Conservative position. Republicans made their bed a year and a half ago by agreeing to sequestration.
Give “progressive” Democrats what they want and let them own it. When average everyday Americans who happen to be Democrats or Independents start feeling the economic pain, let “progressives” explain a failure that is covered with their fingerprints and nobody else’s.