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The latest proposal by Senate majority leader, Harry Reid, will have $2.7 trillion in cuts, no tax increases, and it would raise the debt limit beyond the 2013 political season. Of the $2.7 trillion in cuts, one trillion dollars would come from the withdrawal from Iraq and Afghanistan. John Boehner and the house republicans are crafting two proposals. Both will be in the framework of a two-step proposal, with triggers. If the cuts are not met, the individual mandate would be repealed and if the tax revenues are not met, the Bush tax cuts for the top 2% would be eliminated. All plans will have a another bipartisan committee look for ways to reform the entitlements and improve the tax code. There's not a plan out there that makes economic sense because they don't include entitlement reform, defense spending, or new revenues to lessen the cuts and to spur growth. I wish that we would eliminate the debt ceiling vote altogether as most industrial nations. The debt ceiling does not need to be held hostage for ideological battles.

Yesterday, the treasury secretary went on the talk shows to emphasize how important it was to frame a deal before the Asian markets opened today. The Asian market did drop a little but the European market still thinks we will pass our debt ceiling. Our market is not in crisis mode yet, but they will be if we don't get a deal by next Monday morning. Treasury Secretary Timothy Geither will lose his credibility if he continues to go out and cry wolf unnecessarily. He does need to put the information out there, but then he needs to step back and let Congress do the convincing.

We have a dysfunctional government because it's all about scoring political points. We have one side that will not raise taxes one cent, wants to privatize Medicare, and make draconian cuts, despite the advice of the Congressional Budget Office. The other side does not want entitlement reform. The extremes of both sides are making it very difficult for those who want to make a deal. The Republicans say that the president does not want a short term deal because it will interfere with his election run, but they know that they don't want one either, for the same reasons. Both sides say they want a flatter tax with lower rates and the elimination of several tax loopholes. The republicans want equal cuts to go with the amount of tax revenues. The democrats want to tax the top 2% to take the burden off the elderly, the poor, and others who have taken the brunt of the economic downturn. Where are the talks for creating the environment for more jobs, climate-change initiatives, alternative clean energy and education? Have we become a country that can't do the big things anymore?

The talks should be genuine because they're not throwing out arbitrary numbers, and they have some set of numbers they can rely on such as eliminating all the tax deduction and credits would generate $1 trillion dollars, and we already know and about the $4 trillion in savings if we were to let the entire Bush tax cuts expire. I think the quote of the week came from CBO Director Douglas Elmendorf when he was asked about President's Obama's plan,he said “we can't score political speeches." I can just imagine what would happen if the secretive talks were televised. We would have the politicians pandering to the camera and saying words to further divide the hyper partisan Congress. President Reagan and Tip O'Neill did not hash out their differences in full view, and neither did other great leaders. As I heard this morning, I can't believe that democrats would have dismissed the words of a republican treasury secretary like Donald Regan or Robert Rubin. If we don't have respect for officeholders, then we run the risk of letting the insane run the asylum. I don’t think we need to see the effects of just paying our bondholders and prioritizing payments because if we get our credit rating lowered ,the higher interest rates will affect those who can least afford it.