Randy EickhoffPresident, Acena Consulting, LLC
With the election now over, the real question for Congress and the President seems to be what message was received from the American people. It seems President Obama took the message to mean that partisan politics should be put on a back burner so that Democrats and Republicans can work together for the good of the country. I mean, he did call the new Speaker of the House, John Boehner (Ohio-R) to let him know he was looking forward to working together. That's a good sign...right?
If you ask Rep Boehner, he would tell you (as he did last night, staying on point regardless of the question) the election results signify that "we need to listen to the American people." Really? It's good that Rep Boehner finally got the message; not sure his rhetoric tells anyone anything (let's face it, he is a politician) that those of us working each day to earn a living didn't already know but hey, it makes for good sound bites (as is President Obama's newfound spirit of cooperation).
So...tough economy, Bush tax cuts back on the table, increased governmental spending and impending higher taxes as of January 2011.
Tax reform be it through rate reductions, tax credits, or enhanced deductions have been part of almost all agendas for Presidents faced with a tough or struggling economy. Why? Because reducing taxes in some way, has been shown to stimulate the economy and bring economic growth. The challenge comes in when you look to the "correct" (I was going to say "right" way but don't want to mislead anyone) way to manage taxes and tax reform. In addition, economic theory and history have shown that increased investment by the federal government helps drive economic growth.
So, we know the Republicans want to cut spending, and we know the Democrats want to increase it. We know everyone wants lower taxes; Republicans want it for everyone and Democrats want it for people making less than $200,000 a year if single and $250,000 if married (by the way, I was offended that my spouse's value to the economy is only $50,000 a year; perhaps we should get divorced in order to keep more of our paycheck and just live together? Did someone mention policies to build family value?).
Section 38 tax credits a new weapon against AMT
Already in place are tax credits that can now be used to reduce the effect of alternative minimum tax (passed just recently) which can have a major impact for small business owners. This is a big deal for those people that have small businesses and tax credits they have been generated by research and development, low-income housing, work opportunity, new markets, renewable electricity and a lot of others. While credits generated in prior years can't be used against AMT for 2010, credits generated IN 2010 can and will help.
Can you say compromise?
Going forward, Congress and the President have a lot of work cut out for them. Can you say compromise? You have to appreciate the American people forcing Democrats and Republicans to work together; if they don't, the American people suffer more than they already have and will take more action to make changes until someone does.
While I don't pretend to speak for the American people, my two cents goes to the message that partisan politics and partisan agendas just went out of fashion; continue wearing your party's colors, carrying your party's flag and preaching your party's mantra and you won't get an invitation to America's party or a place in our future success.
Message to Congress and the President - It's not about the Party (and it never has been for the American people).