Re: Cliffy
The Guardian:
If either Congress or the president fail to change the law, on 1 January 2013 two things happen: first, there is a collection of tax cuts that will end; together, this immediately raises taxes by $500bn each year, or $5tn over the next decade. The "death tax" rises to 55%, the $500 per child tax credit disappears; the bottom rate of income tax jumps from 10% to 15%, and the top marginal tax rate on individuals would jump to 39.5%. The Alternative Minimum Tax would move from hitting 4 million Americans to whacking more than 30 million families.
............
The second part of the fiscal cliff is that, if unchanged, there will be a slightly more than $100bn reduction in spending in 2013 and every year for ten years. This would reduce spending in 2013 from $3.69tn to $3.62tn, and over ten years from $44.3tn to $42.8tn
guardian.co.uk
In other words, the so-called "cliff" is that taxes may increase - by a large amount, while spending may decrease - just a tiny bit. Even this, according to The Guardian, will most likely not happen. Both parties, more likely than not, will simply agree to extend the current situation.
My question is - how come Boehner agreed to such an idiotic default setting? In effect, he agreed to huge tax increases in return for almost nothing on the side of spending cuts. It seems that the default is much closer to the interests of the Democrats. I wonder why they would even bother arguing.
Generally, the "cliff" talk is annoying - instead of explaining the issue, it just fogs it up. |
