“Fiscal cliff” is a term many Americans are beginning to know all too well. The term is used to describe the coming fiscal crisis if Washington does not arrive at some sort of agreement on the budget. While fiscal cliff conjures images of Wyle E. Coyote taking one of his famous dives to the desert floor, will that be the case? Or are we about to experience a resounding change of analogies?
The Hill reported this week that, in October, the first month of the new fiscal year, America racked up a deficit of $120 billion dollars. With debt ratio numbers that would make your average family at least cut up their credit cards, the government spent much more than it took in, spending $304 billion dollars while collecting only $184 billion in revenue.
That spending fact along with expectations that the US will hit its $16.39 trillion borrowing limit by the end of this calendar year is making the fiscal cliff look like a dangerous reality.
However, writing in the International Business Times, Joseph Lazzaro suggests that our financial problems won’t be so much of a fiscal cliff,but more equivalent to a chilly room: that we may be uncomfortable for a time but the situation is not deadly.
Lazzaro claims that, because the IRS will probably not have its tax tables adjusted by January 2, it therefore will not be poised to help push the economy off the fiscal cliff. The President and Congress will therefore still have time to come up with a budget, and, when they do, this it will cause the IRS to tear up its tax tables and start over.
Lazzaro further suggests that the current idea of slightly taxing the super rich more while leaving the middle class alone will not greatly slow our financial crisis. However, Lazarro does conclude that the focus of Washington should be on establishing policies that will enhance job creation. Lazarro says jobs for the millions of Americans looking for them is the best way to bridge any fiscal cliff.