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The Fiscal Cliff

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  • #94584

    News
    Participant

    Fiscal cliff combines tax hikes, spending cuts

    ANDREW TAYLOR | November 7, 2012 05:36 PM

    WASHINGTON — So just what is this “fiscal cliff” that has the financial markets rattled and economists and policymakers alike in a tizzy over the potential for sending the economy into another tailspin? It’s a one-two punch of expiring Bush-era tax cuts and major across-the-board spending cuts to the Pentagon and domestic programs that could total $800 billion next year, based on Congressional Budget Office estimates.

    READ MORE: http://www.huffingtonpost.com/huff-wires/20121107/us-congress-fiscal-cliff/


    OP/ED | 11/10/2012 @ 10:27AM

    The Fiscal Cliff Explained

    It’s the phrase that will be dominating the airwaves in the days and months to come as the pundits and prognosticators leave the 2012 election behind and turn their attention to dire predictions of economic collapse should the government allow us to tumble over “the fiscal cliff.” So, exactly what is the fiscal cliff and why is everyone so worried about it?

    READ MORE: http://www.forbes.com/sites/rickungar/2012/11/10/the-fiscal-cliff-explained/


    Obama, Boehner stand ground on fiscal cliff

    Posted by CNN’s Gregory Wallace

    (CNN) – Washington’s top Republican and Democrat minded their positions on Saturday ahead of plans for the two to meet face-to-face in an effort to avert the so-called fiscal cliff. President Barack Obama and House Speaker John Boehner summarized in their weekly addresses the positions each had laid out earlier in the week in separate post-election remarks.

    READ MORE: http://politicalticker.blogs.cnn.com/2012/11/10/obama-boehner-stand-ground-on-fiscal-cliff/


    OP-ED COLUMNIST

    Let’s Not Make a Deal

    By PAUL KRUGMAN

    Published: November 8, 2012

    Republicans are trying, for the third time since he took office, to use economic blackmail to achieve a goal they lack the votes to achieve through the normal legislative process. In particular, they want to extend the Bush tax cuts for the wealthy, even though the nation can’t afford to make those tax cuts permanent and the public believes that taxes on the rich should go up — and they’re threatening to block any deal on anything else unless they get their way. So they are, in effect, threatening to tank the economy unless their demands are met.

    READ MORE: http://www.nytimes.com/2012/11/09/opinion/krugman-lets-not-make-a-deal.html?smid=fb-share&_r=0

    #519253

    News
    Participant

    The Fiscal Cliff Explainer: What It Is, Where It’s From, Who Will Pay, and Why It Matters
    9 NOV 9 2012, 10:41 AM

    The end of the election means the most important story in politics is the Fiscal Cliff — a sudden rise in taxes combined with spending cuts scheduled for January 1, 2013. But before we get to the policy — and the graphs — let’s talk about the term. “Cliff” is an imperfect analogy. It’s really more a long, rolling hill. A fiscal slope.

    READ MORE: http://www.theatlantic.com/business/archive/2012/11/the-fiscal-cliff-explainer-what-it-is-where-its-from-who-will-pay-and-why-it-matters/264990/

    #519254

    bman
    Participant

    Who thinks we should just allow everything to expire and the cuts to hit? I think we should call the right wings bluff.

    #519255
    Coremodels
    Coremodels
    Participant

    Won’t happen, its a scary thing they set up, but both sides are already making it clear they’re ready to prevent it.

    #519256

    tdziemia
    Participant

    Most economists agree that doing nothing will take half a percent off GDP growth in 2013 and send unemployment back up. It’s the last thing America needs right now. Yes, it would call the right’s bluff, but at a significan tcost for all of us.

    #519257

    Analogue Kid
    Participant

    In a sense I’m glad the media is calling it a cliff because that sounds much more scary and in need of attention. A fiscal slope just sounds like something you find in an economic park. If enough people write letters to Stivers and Tiberi saying “make a damn deal already”, they probably will because it will make them nervous.

    #519258

    That’s why I voted third party. The two party system no longer works.

    #519259
    Walker Evans
    Walker Evans
    Keymaster

    bman said:
    Who thinks we should just allow everything to expire and the cuts to hit? I think we should call the right wings bluff.

    The more I read, the more I’m ready to go over the cliff.

    Taxes rise. Spending gets cut. Debt gets paid off.

    Short term inconvenience for long term fiscal responsibility.

    Sounds less like a “cliff” and more like a straightening of priorities.

    #519260
    Snarf
    Snarf
    Participant

    Tax churches.

    #519261

    GCrites80s
    Participant

    ^But then a lot less Christian Rock would be made.

    #519262

    Alex Silbajoris
    Participant

    Snarf said:
    Tax churches.

    Frank Zappa said the same thing.

    #519263

    James
    Participant

    News said:
    The Fiscal Cliff Explainer: What It Is, Where It’s From, Who Will Pay, and Why It Matters
    9 NOV 9 2012, 10:41 AM

    The end of the election means the most important story in politics is the Fiscal Cliff — a sudden rise in taxes combined with spending cuts scheduled for January 1, 2013. But before we get to the policy — and the graphs — let’s talk about the term. “Cliff” is an imperfect analogy. It’s really more a long, rolling hill. A fiscal slope.

    READ MORE: http://www.theatlantic.com/business/archive/2012/11/the-fiscal-cliff-explainer-what-it-is-where-its-from-who-will-pay-and-why-it-matters/264990/

    These tax increases will be much more painful than they appear. The example of somebody making $50k a year in the article and paying an extra $2k in taxes would feel a lot of pain. After federal, state & local taxes, rent or mortgage, utilities, car payments & gas, student loans, health & homeowner insurance it wouldn’t surprise me if there was $10k left over, or even less. $2k isn’t a 4% loss of spending, it would really be more like a 20% loss. Or easily more given the credit card debt people have. I’d think the first reaction would be to cut way back on anything discretionary, would would really put the brakes on the economy.
    I certainly hope they strike a deal to avoid most of these tax increases. They’re a blunt weapon, designed to be painful and to force politicians to act.

    #519264
    rus
    rus
    Participant

    Walker said:
    The more I read, the more I’m ready to go over the cliff.

    Taxes rise. Spending gets cut. Debt gets paid off.

    Short term inconvenience for long term fiscal responsibility.

    Sounds less like a “cliff” and more like a straightening of priorities.

    I’m leaning that way myself. Really like the medicaid cuts and the curtailing of unemployment benefits.

    If raising taxes is the price to pay for slashing social spending, so be it.

    James has a point that tax increases will remove a good bit of discretionary spending and that will likely lead to short term pain. Reducing debt levels seems more beneficial long term.

    #519265
    Walker Evans
    Walker Evans
    Keymaster

    rus said:
    James has a point that tax increases will remove a good bit of discretionary spending and that will likely lead to short term pain.

    Depends on how you define “pain”. Americans buying less junk for awhile? Sounds like a good thing to me. ;)

    #519266
    Walker Evans
    Walker Evans
    Keymaster

    James said:
    These tax increases will be much more painful than they appear. The example of somebody making $50k a year in the article and paying an extra $2k in taxes would feel a lot of pain. After federal, state & local taxes, rent or mortgage, utilities, car payments & gas, student loans, health & homeowner insurance it wouldn’t surprise me if there was $10k left over, or even less. $2k isn’t a 4% loss of spending, it would really be more like a 20% loss. Or easily more given the credit card debt people have. I’d think the first reaction would be to cut way back on anything discretionary, would would really put the brakes on the economy.

    Sure, but what better way to curtail the accumulation of personal credit card debt than to force the reduction of discretionary spending? The average $50k salary owner could ditch their $60/mo cable tv plan, cook more at home and eat out less, rationalize driving the car a bit less, and make a more conscious decision to not be wasteful with one’s dollars and probably get over that $2k hump without any true “pain”. Maybe might have to cancel taking a summer vacation in 2013 or buying a new TV with a tax return paycheck. Yee-owch!

    So is that a bad thing for the economy? Yes, but only because America is way too oversaturated with retail to begin with. Our economy should not be propped up by the mantra that Americans needs to keep buying shit they don’t really need just to squeak out that 1.7% economic growth stat by the end of the year.

    Not to get all “Fight Club”, but this fiscal cliff might just be a necessary economic reality check for our country. Don’t buy anything for a year and pay off the national debt. It’s gotta happen sooner or later, so why not sooner?

Viewing 15 posts - 1 through 15 (of 244 total)

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