House Republicans have unveiled their counter offer to President Obama to avoid going over what economists have called the “fiscal cliff.” The plan, presented by House Majority Leader John Boehner, aims to raise $800 billion dollars over the next ten years with a mixture of tax reform and spending cuts to entitlement programs.
House Republicans stuck to their guns by demanding that the tax rates for all Americans stay where they are right now, keeping the Bush Tax Cuts in place for even those making more than $250,000 per year. President Obama and Congressional Democrats have proposed raising more than $1.6 trillion dollars over the next ten years by raising taxes on the wealthy.
In contrast, House Republicans plan to raise revenue by closing loopholes and deductions on wealthy tax payers. Their plan also will raise the eligibility age for Medicare and trim cost of living increases for those on Social Security.
Majority Leader Boehner has criticized the white House for their proposed tax increases saying that there is no way Congress or the Senate will agree to raise taxes on everyone and at the same time increase spending, which the Democratic plan calls for. In addition to the tax increases on the wealthy, President Obama’s plan calls for increased stimulus spending on infrastructure projects, increased unemployment benefits, and investments in clean energy.
Boehner said of the President’s plan:
“After the election I offered to speed this up by putting revenue on the table and unfortunately the White House responded with their la-la land offer that couldn’t pass the House, couldn’t pass the Senate and it was basically the president’s budget from last February.”
The President’s budget from last February, the only budget ever presented by the White House, was rejected unanimously by the Senate.
If the President and Congress fail to reach an agreement by January 1, 2013 ,the American economy will go over the “fiscal cliff.” This means that is one fail swoop, the American people will get hit with tax increases to all Americans, unemployment benefits will dry up, the Federal budget will endure billions in mandated cuts, and doctors will see their Medicare/Medicaid reimbursements drop considerably. Economists have predicted that if Congress and the President fail to act, it is almost guaranteed the American economy will endure another recession.
Do you think Congress and President Obama will have the courage to avoid the American economy going over the “fiscal cliff”?