Preparing for lack of compromise

Compromise does not seem to be in the cards for the "fiscal cliff" negotiations.  President Obama keeps rattling on about the "rich" paying more taxes, making sure to heighten the public divide, and as if $250,000 in income in a place like New York City is remotely rich, and the Republicans seemingly will not bend on an item that a majority of their voting constituents, not big money constituents, would agree is just fine, raise taxes on the wealthy by a modest amount.

Obama is not negotiating and there is no work at all being visible done on how to cut costs, on entitlements, or defense, or on the incredibly bloated and the many marginally competent departments of government.  No word from Republicans on anything but taxes?  So what to do?

Prepare for the worst.  Map out a plan to sell all equities with material capital gains within the next two weeks.  Do the same with heavy dividend paying stocks.  Close any financial transactions with gains, real estate sales etc., before year end.  What we know for sure is that taxes on capital gains and dividends will not go down, and if a settlement is reached between Congress and the Adminstration rates will still likely go up modestly.  Waiting for the 30 day wash period to pass, all stocks can be bought back.  If there is a fall off the "fiscal cliff", they can be bought back cheap.  If not, there is little chance of some substantial rally near term because whatever they agree on will be weird work, incomplete, and subject to regulatory interpretation.

This advice is difficult to follow through on... could lead to a much higher tax bill in 2012 but economically it could well be the right move.  Can I do it...    ?