Mr. President:

It’s time for you to lead on the fiscal cliff. Climb out of the little red car, take off the clown shoes and exit the circus. Perpetual campaigns may play to your oratorical strength but they suck the life out of the people you are supposed to lead. Your current conduct undermines the very constitutional framework of co-equal branches of government that you are sworn to uphold.

It time for you to really heed the words of Dr. King:

Ultimately a genuine leader is not a searcher for consensus, but a molder of consensus. On some positions, cowardice asks the question, is it expedient? And then expedience comes along and asks the question, is it politic? Vanity asks the question, is it popular? Conscience asks the question, is it right? There comes a time when one must take the position that is neither safe nor politic nor popular, but he must do it because conscience tells him it is right.

Mr. President, we the people, are not complete idiots. If you raise tax rates on the infamous 2% we understand they will simply hide more income utilizing the plethora of deductions currently in the tax code. Deductions that ultimately undermine any attempt at progressivity in the tax code you claim to require. This isn’t about increasing revenue for the Treasury; it’s about being vain, expedient and popular. It’s about sticking it to the other guy, even though the people elected this House of Representatives as well. What it isn’t about is reasoned leadership required in this time of crisis.

One message of the tax rate battle is, if you are single and thinking about getting married –maybe you shouldn’t because the government penalizes marriage. Think about it, single making $200,000 could be subject to a tax rate increase, but married? Well it’s only $250,000. Taxes should be an individual liability and a “family” should not be a taxable entity. We should equally value individual effort.

As a brief aside, the policy flows from community property laws in individual states that encouraged married couples to file individual tax returns (splitting the income) to limit tax liability. Congress adopted a change that allowed all married couple to essentially split incomes (a rule adopted when most women did not work outside the home). The initial result was a drop in rates for married couples. In fact, this situation actually discouraged women from entering the workforce and was, of course, unfair to single filers. As Congress tried to address this to establish fairness, more and more women began to enter the workforce, and thus married couples began to face the marriage penalty tax. Common sense suggests it is an artifact and should be done away with.

Let me put this in some sort of context. It’s more than conceivable that you could have two civil servants (say Assistant US Attorneys), who work in a high cost of living area, so their salaries bust the $250,000 level – after all even the federal pay scale recognizes cost of living issues and pays locality allowances based on area (see http://www.opm.gov/oca/12tables/pdf/saltbl.pdf). They are not rich. They are raising kids, saving for college, paying a mortgage, and probably still paying off student loans. They have need for a bigger house, so their mortgage eats up more of their paycheck than the comparable single person. They are altruistic, believing in serving the public good and so they are not making the money they could make in the private sector. Maybe they are also military reservists, and this additional income really pushes them over the limit. Do we really believe these folks are the top 2% and somehow are sucking the life out of the rest of the nation? Why is nothing at least tied to cost of living? Wouldn’t that actually be the fair and progressive thing to do?

Not so long ago, Mr. President, you said reducing deductions could raise as much as $1.2 trillion dollars. So why abandon this for a rate increase that will probably never bring in the revenue you need? Why not be serious about these issues? You once ran as a transformative politician and the only transformation I have seen is you into a petty, narrow, and somewhat mean-spirited competitor. This is governing Mr. President; it isn’t a game of basketball.

It’s simple math that most households understand: Money in should exceed (or at least be equal to) money out. If a citizen is consistently charging $10,000 a month to a charge card (and only paying the minimum due), the fact that he suddenly reduces the excessive charging to $7500 doesn’t mean he is saving $2500 a month. He is still going into debt. He cannot turn around and say let’s invest that $2500 in something else because it doesn’t exist. It is just debt, red ink, and the quick trip down the bankruptcy expressway. Whatever peace dividend there is from our overseas drawdown is not money that suddenly exists to be spent Mr. President, it’s just less money we are borrowing.

We all understand this is a very complicated issue and the math is really, really tough. We can blame the war expenditures for the deficit, except that the truth is the numbers indicate, Mr. President, your spending has exacerbated the problem. Don’t forget about the $700 billion stimulus that didn’t work – you cannot blame that one on President Bush. But surely we don’t then include that number into a baseline moving forward do we?

So what to do? Well governing is always about finding the middle ground and making sure no one is completely happy (it’s called compromise not conquest). Increase revenue through capping deductions is a good first start. Then reform the entire bloated, 70,000-page code. But an increase in revenue is only part of the solution. You have to cut Mr. President. Yes, you can probably find more efficiencies within the Department of Defense, but you have to look everywhere. Entitlements have to be reduced. Means testing makes sense. Raise the retirement age– we are living longer than we did 30 years ago so this also only makes sense. Maybe we should re-baseline by going back to 2003 spending levels as an appropriate baseline – before the full war costs were exploding the deficit. But, a solution that calls for raising $4 dollars in taxes for every dollar cut, and then tries to sneak in additional stimulus spending isn’t a serious proposal, Mr. President. It was the equivalent of a clown squirting water from his fake lapel flower into the eye of an unsuspecting circus attendee. The clown gets a good laugh but the other guy? He just gets wet.

Mr. President, the most important lesson in leadership I learned was as a kid in my older sister’s office. She had a desk plate than put it this way: Lead, follow, or get the hell out of the way. Which is it to be?