‘Fiscal cliff’: Consensus on increasing tax revenue, a wide gulf on how to do it
Democrats and Republicans have agreed that taxes must be raised gradually in order to prevent the US from falling off the "fiscal cliff" of sudden tax increases and severe budget cuts that will most likely trigger another recession. Democrats want to allow the Bush tax cuts to expire for the top two tax brackets, resulting in $1 trillion of savings, but Republicans insist on extending them for all Americans. Republicans believe that enough savings can be found be closing loopholes and removing deductions within the tax code, and that closing loopholes is less damaging to the economy. Closing loopholes is more popular with Americans, but the GOP has few specifics and it's unlikely that removing deductions will be enough to establish fiscal solvency over the long-term. Congressional leadership has developed a legislative "framework," but the real policy details are still being negotiated. Another integral part of any compromise on debt reduction will include certain adjustments to Social Security and Medicare, which President Obama has agreed to making, like raising the age of eligibility. However, some congressional Democrats are unwilling to agree to changing entitlement programs and could not fall in line with the president.
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I feel that the Democrats need to change in some of there things as Johnny Mac posted, such as Medicare and Social Security. Many people have to think though, at least we have some form of Medicare and Social Security, but hopefully it will get better. As for the Democrats that do not want to change your views, you are a DEMOCRAT, you are suppose to want change, not stay with what you already have.
ReplyDeleteCompromise is the essence to politics, and given the extremely divided government we are currently plagued by, it doesn't seem that this will be resolved with any grace. No one likes the sound of higher taxes; however, we've also never been faced with such an extreme deficit. Ideally, we could raise the taxes and close the loopholes and save money from the both of them.
ReplyDeleteI agree with Nora that compromise is essential. I personally believe that closing loopholes and removing deductions is a great option. However, it can't be done alone. While taxes should eventually be brought down again, right now I think it's important that taxes don't stay this low forever. However, I also don't think that taxes should be raised greatly, especially just for the two highest income brackets. I firmly believe in flat tax rates. As far as social security goes ( I know this is a pretty unpopular view and will probably never happen), I believe that it is an awful, horrible system. It’s not the government’s job to manage your money for you. I am completely capable of saving for my retirement by myself. By paying into social security, you may never see your hard-earned money when it comes time for you to retire. I think the best solution is to make paying into social security optional, so those who do want assistance with retirement have that option available to them.
ReplyDeleteCompromise is the only answer to this problem, but the stubbornness in our government continues to prevail. The president even agreed to some sorts of compromise with Medicare and Social Security. He's making baby steps on the way to a compromise, but not every Democrat agrees with compromise. This gridlock is becoming more and more frustrating as we get closer to hitting the fiscal cliff. There are a good amount of solutions to this problem, so it's a shame Congress can't agree on any of them.
ReplyDeleteI also agree that there needs to be compromises made on both sides. Maybe somewhere in the middle is the right answer, but in the current state that we are in, Americans need to realize that we need to do what we need to do in order to get the country back on track. It will not be ideal to everyone, but we need to buckle down. I also think that closing loopholes and removing deductions is a great option and hopefully will lead to some sort of progress. I again agree with Nicolette when she says that the government does not need to be managing individuals money. Americans should be taking financial responsibility for things and preparing. I hope to see progress in the near future.
ReplyDeleteIt would be great if we could just close loopholes and we would save money. The problem is that that would not be enough. If it was, it would have been in effect today. We need to go back to the Clinton era tax system. That obviously worked, since we ended with a surplus (teardrop). I think it is interesting that this whole fiscal cliff problem was not mentioned until after the election. Why? Because no matter what, in order to fix this problem unpopular decisions are going to have to be made, and neither candidate wanted to discuss those popular decisions. I think that is very important.
ReplyDeleteMaking cuts on Social Security and Medicare are obviously going to be unpopular. But if we do not, or if we do so incorrectly, those programs will not be there when we need them. Until we get the debt under control, which will not happen until the Bush tax cuts expire, and the wealthiest of Americans are paying just a little bit more, we have to make sacrifices. It is not going to be easy, but we have made it out of the recession, and we have only been making progress. Now all we need is some compromising, and we will be back to the America and everyone wants and needs us to be.
Oh look they compromised, and it worked! See people in congress compromise works! I like how they are making it, but time will tell in how the bill ends up looking. I do not like how the Republicans still want the Bush tax cuts, it's been almost 4 years since his term ended, let his policy die to because it will make the country more money and many people can see that the wealthy people just want to keep more of their money. So they should just let the Bush tax cuts expire and close the loopholes, because look where the bush tax cuts and loopholes got us...enough said on that manner. Social Security and Medicare should probably be restructured to save us money and to streamline them and make them more effective and long lasting. The matter of fact is that people are going to need to suck it up, the first priority is to get this country out of debt and get the economy recovered and once that happens, we can really enjoy the greatest country in the world.
ReplyDeleteEventually, they will have to compromise as it could greatly harm the U.S and their chances to get re-elected if they don't. What will most likely happen is they will make a small compromise that will function just to prolong this problem like what happened last time with the debt ceiling debate. In order to significantly solve this problem, both sides would need to compromise to a pretty large extent though, which I don't see happening until they can feel the effects of it or when they absolutely have to. I hope that they can solve it before it hurts us but I'm not sure either side is willing to risk it politically.
ReplyDeleteI agree with most of my classmatea that this issue will mostly likely not be resolved by the fiscal cliff. The driving factor behind my negative foesight stems from somw hard headed Democrats. If the President is willing to compromise with his policies, I think the hard headed Democrats can as well. Let's be honest, nobody wants higher taxes, even if tax raises could help our deficit. The gridlock must end.
ReplyDeleteI agree with Nora in that compromise must be made. I also agree that this conflict will not be resolved gracefully. What ever decision is made there will always be unhappy people. However, It is important to keep in mind the best interest for the American people. We are dealing with two very different opposing forces and so it should be interesting how it turns out.
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