Over the past six and a half years, I’ve written quite a bit about personal finance and related financial news. However, whenever the really big financial news comes out, I’m often not interested in writing about it. Such is the case with the fiscal cliff. It seems like every news outlet is either writing about that or what’s going on Kim Kardashian’s tummy and I can’t recommend spending your time on either.

A few weeks ago, I relented and wrote about this fiscal cliff thing and I’m going to do today.

I have four main areas that I’d like to cover with regard to the fiscal cliff:

1. The 2% “payroll tax hike”

I’ve read numerous articles claiming that everyone’s taxes are being raised. Each article points to the 2% tax relief we (Americans) got to help boost the economy. This came from the Social Security tax. In other words, we took more from an underfunded source creating a bigger problem in the future. Guest author Kosmo covered it well in this article, Social Security’s Death Clock Ticks Faster this Year:

“So we take a program that is already on shaky ground … and cut funding? Sure, it will be great to have a few extra dollars in our pocket on pay day (I like extra money as much as the next person), but this seems to be missing the forest for the trees. Then there’s the prospect of this cut ending at the conclusion of 2011. Will it really end? Or will there be fear that a reversion to the regular rate will be characterized as a ‘tax increase’? If that’s the case, we could see a few more years of underfunding for social security until someone finally has the cojones to say ‘If we want to keep Social Security, we need to pay for it.'”

Nostradamus had nothing on Kosmo. Almost every article I read is characterizing this reversion to the regular rate as a tax increase. While technically true, it doesn’t deserve the bad press surrounding it. Either be thankful you got it in the first place, or celebrate our Social Security funding getting back to the norm.

The upshot of the 2% means that someone making $30,000 is going to be making around $50 less a month. I realize that there are a lot of struggling people out there. I feel for those people. On the other hand, to the people with iPhones and iPads complaining about this, “I’m Like, ‘[email protected]#% You!’”.

I can save most people a lot more than $50 a month, relatively painlessly. I put a bunch ideas on that here: fast finance fixes.

2. The raising of taxes on people making 250K vs. 450K

We just finished saying how it is such a crime that the people making $30,000 a year are going to lose $50 a month, right? With all the struggling people and the high unemployment rate, we should be focused on these people right? So what better way to demonstrate the highest level of hypocrisy by making a big deal out of whether we are raising on those making 250K, 450K, or 1M?

Let me make sure I’m clear on this: Congress was quarrelling over whether to raise taxes on the top ~98% or the top ~99% at the expense of everyone (including those in both ranges since they’d have their taxes raised too).

The only way this could make less sense is if the quarrel was irrelevant in the first place. And according to this Forbes article it was. The long shot is that many of these people are going to get hit by the Alternative Minimum Tax (AMT) anyway.

Awesome… all that fighting for what seems to be nothing.

3. This “Solution” is just a drop in the bucket

The taxes amounted to 61 billion in more income a year for the government on average, while the annual deficit is something like 1100 billion (or better known as 1.1 trillion). So we’ve fixed about 5% of the problem for this year… and then we’ve got another 16 trillion in debt behind that.

I like how Rob Berger of The Dough Roller put it in one of the comments of his article: “… we’ve spent an extraordinary amount of time arguing over taxes on the top 2 percent when the revenue they will generate is so small compared to our problems. It would be like focusing all of our attention on patching a small hole in the Titanic while ignoring a huge hole on the other side of the ship.”

I wish I was an artist so I could draw some kind of political cartoon with an ant ($61 billion) trying to fight an elephant (1.1 trillion) and both them not being aware of the nuclear bomb being dropped on them (16 trillion). I realize you have to start somewhere, but it is ridiculous to be fighting a this level.

4. The people upset with politicians in Washington

This reminds me of one of my favorite Buffy the Vampire Quotes: “So, Dawn’s in trouble… must be Tuesday.” In other words, what else is new?

I am shocked that night after night the news was able to find people legitimately surprised by everything that happened with the fiscal cliff. I turned on CNBC and people were complaining about the lack of leadership in Washington.

How much progress do you think would be made if you put the Hatfields and the McCoys in the same room and told them they had to come to an agreement. What about the Autobots and the Decepticons? You get the idea.

It’s like complaining that a country in the middle of a civil war isn’t leading the rest of the world. It just isn’t going to happen.

I’m trying hard not blame one political party or the other, but well, screw it. When someone says, “The rape guy lost the election” and another person has to clarify, “which rape guy?” your political party has a problem. When one of your most public faces, Michele Bachmann, doesn’t know the basic facts about vaccines and autism, and publicly displays her ignorance many times, it demonstrates a lack of intelligence in your party’s leadership. All is not lost for your political party though… in the past few months Chris Christie has shown multiple times that he’s there for the people he represents with his response to Hurricane Sandy. He’s not afraid to praise the other political party when they help the cause. He’s not afraid to blast his own party and John Boehner when they leave without voting on the bill that would aid victims of Hurricane Sandy.

With people like that, maybe there’s hope that common sense and coming together for the welfare of the nation can still happen.