RS
6: Cliffhanger
Recently
in the news there has been much talk of the fiscal cliff. The fiscal cliff was an attempt to lower the
amount of government spending and increase taxes on US citizens. Because the country has been in debt,
Congress has been trying to come up with a way to solve this problem. Both the House and the Senate have been torn
on whether to cut spending, increase taxes only for the wealthy, or increase
taxes for all citizens. The debt ceiling
would put a limit on the spending and borrowing of Congress, which is where the
debate comes in. Congress was unsure if
they wanted to extend the ceiling because once the ceiling is hit, the
government cannot borrow any money, and spending would have to be cut. Many people in Congress thought that the
fiscal cliff could help alleviate the debt crisis, but many Republican
Congressmen, such as John Boehner, disagree.
The
fiscal cliff had not only citizens outraged, but Republicans as well. The Republicans knew that the fiscal cliff
would raise all Americans taxes, even if the Democrats claimed that it would
only raise taxes on the wealthy. According
to the fiscal cliff policy, as your income increases the amount of taxes you
pay has to increase as well. For
example, all of the retirement plans such as a 401K would have higher
taxes. A person who makes $50,000 a year
would have $20 a week coming out of their paycheck for social security
alone. While that does not seem like a
lot, that adds up to almost $1,100 dollars a year just for social
security. It is said that the average
middle-income families will pay an additional $2,000 a year in taxes. This had the Republicans outraged because
they did not want to have citizens pay anymore than they already had too.
Paul Ryan, a
Republican Congressmen, created The Path to Prosperity:
A Blueprint for American Renewal, which was a proposed budget plan to prevent
the country from going into more debt than it already was. According to this blueprint, Ryan planned to cut
spending, lower taxes, repeal Obama’s healthcare plan, and create a partial
privatization of healthcare. This would
have allowed for a better budget plan that would not have caused such a
dramatic increase in taxes. President
Obama took this as a personal attack and fought back against the Republican
proposed budget. Republicans did not
want the taxes to increase for the citizens because it would cause even more
problems, possibly bringing us back into another recession.
Because of all the debate over this topic, President Obama
contacted John Boehner, Republican Speaker of the House, in order to come up
with a mutual decision on how to deal with the budget crisis. Both discussed the options for the country,
and in the end it was decided that the debt ceiling would be suspended until
May 18, and that by April 15 the House and Senate both need to pass a budget
resolution. Although this is a temporary
solution, it is still causing chaos because no one knows what is going to
happen in the coming months.
No comments:
Post a Comment