“Unrelenting rigidity”

July 7, 2011

“Unrelenting rigidity”

It feels as though American politics has become a war. The battle is not about civil rights or women’s suffrage; it’s a war about how large a role the government should play in the redistribution of income and the support of the people. There is plenty of room to disagree on these issues.

Throughout our history, there have been Americans who have suffered, and in the current faltering recovery, there are an exceptionally high number of people suffering. This makes the current war over reducing entitlements seem especially harsh.Unfortunately, Democrats and Republicans have taken rock-hard positions and have refused to come down from their pulpits. Minnesota has shut down the state government for seven days because the Democrats and Republicans refuse to even meet to discuss a compromise. From the Minneapolis Star Tribune:

In Minnesota, it remains uncertain whether results can be expected from an ad hoc budget group formed this week by former Republican Gov. Arne Carlson and former Vice President Walter Mondale, a Democrat.

“I never remember a time when we had such deadlock, paralysis, almost unrelenting rigidity,” said Mondale, a veteran of the epic civil rights battles of the 1960s. “We were able to work across the aisle and shape what I call American solutions to big issues.”

Mondale said he’s at a loss to explain what happened in the ensuing years. “Something happened to shatter that essential ability to compromise and build for the future,” he said.

The roots, he said, reside not in Minnesota but in the increasingly polarized national political arena. “I’m worried that this fever that’s seized Washington has been nationalized,” he said.

We need more dialogue and less vitriol. We need more data and an effort to understand the big picture. We need compromise. We need for everyone to come down from their pulpits and sit together around the fire. It’s time for a little “Kumbaya,” America.

Tax reform heats up a little

From the Bond Buyer:

Sens. Ron Wyden, D-Ore., and Dan Coats, R-Ind., are urging President Obama and congressional leaders to agree to include in their debt-reduction plan an agreement to enact comprehensive tax-reform legislation before the end of the year.

They made the request in a two-page letter and release accompanied by the tax-reform bill they have introduced, which would require all new municipal bonds to be issued as tax-credit rather than tax-exempt bonds.

The Bipartisan Tax Fairness and Simplification Act of 2011, S. 727, which they introduced on April 5, also would repeal the alternative minimum tax for individuals.

Good links

Investors Chronicle: Puny muni issuance

Bond Buyer: N.Y.C. Comptroller: Pension Funds Showed 20% Returns in Fiscal 2011

On the Economy: More on State Fiscal Travails

CNBC: VIDEO: Alexandra Lebenthal: Best Quarter for Munis Since 1999

Bloomberg: Ambac Financial Group Files Proposed Chapter 11 Plan for Reorganization

The Examiner: New D.C. budget battle will focus on bonds tax

Photo: Walter Modale in 2010

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