By Allen Kehring
President
Obama is meeting with Congress to discuss about the tax cuts placed by
President Bush. If they do not find an agreement before January, then we will
reach a fiscal cliff which would increase our taxes and spending cuts. This would
hurt our economy to where we would have a recession for the first half of the
year. This is why Obama is trying to meet with Congress now to be able to come
to an agreement for the first of the year.
If we would reach the fiscal cliff,
the middle class families would have to pay $2,000 more next year for taxes.
This will also affect more Americans who would lose up to 3.4 million jobs and
the stocks would plummet. The recession would be an estimated $671 billion that
would greatly hurt our economy. We would also have the highest tax increase in
60 years.
Many businesses are starting to get
prepared for next year just in case it does happen. They are starting to cut
spending and put off hiring people. This will not seem to help our economy much
because we need to get money into our system to keep us from going into further
debt. Also many people would start seeing that their money in their paycheck is
reduced at the beginning of next year.
According to the Tax Policy center,
they state that the bottom 20 percent would pay an average of $412 more a year,
the top 20 percent would pay $14,000 more a year, and the top one percent would
pay an average of $121,000 more a year on taxes. This would definitely hurt our
economy because people would not be able to spend much money which would then
hurt the businesses income. Our money flow would be less which then hurts the
total economy.
If we do hit this cliff we will have
many important programs cut which will greatly affect people’s jobs. The
defense will be cut and many Pentagon jobs will be cut, doctors and their
offices will be cut, and nearly two million people will no longer get
unemployment. No one will want to see this fiscal cliff happen because this
will greatly hurt our economy.
Many people really need to have the
Congress come to an agreement with President Obama about what we are going to
do with the economy. The best way that they are thinking to help the economy
would be taxing those making $250,000 or more. With the Congress being mostly
republicans and Obama democratic, they have differing views on how they want to
have the economy fixed. Obama wants to tax those with the higher income but
most of the republicans do not want to. Some businesses who supported Mitt
Romney are trying to get republicans to see that they should tax those with the
higher income. We need to have some sort of compromise made because we do not
want to be in another recession like we have had in the past.
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I'm surprised to hear about his because I haven't heard anything about a fiscal cliff until now. It seems to me that if Romney would have been president this wouldn't be an issue because the republicans would have gotten along very well and come to a reasonable solution. Although Romney isn't president so I'm wondering how Obama is going to bend to agree with congress. If he doesn't accomodate to congress I can predict a lot of people being unhappy with their re-elected president.
ReplyDeleteI don't think the fiscal cliff will be coming too soon. It's hard to tell the future with Obama and Congress not being agreeable with each other, but if something doesn't click between them soon, then the economy hitting the fiscal cliff will be inevitable. Also an argument could be made about spending more on taxes from the wealthy people in the top 1 percent. If the taxes aren't being collected, then government jobs and construction projects would suffer as well, creating a vicious cycle.
ReplyDeleteI actually didn't really know anything about this topic until now! After reading this, it just raises a lot of questions like "What kind of an agreement can they possibly come to that will make circumstances better?" and"what are the issues that they are trying to come to an agreement in the first place?" it's also confusin because Obama was for not cutting out government funded programs, and now it looks like if this happens, we may have to. I disagree tht the wealthy should be taxed more, however we do need to come up with a different solution.
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