A cooperative Congress can help avoid fiscal cliff

By Chase Sanders, Kernel columnist

Now that the election is over, it’s time for the politicians in Washington to get back to work after four years of stalemating.

The next big issues the president and Congress must tackle will be debt reduction and tax rates as they negotiate how the federal government will avoid going over the fiscal cliff.

The cliff is a spending cap put on government spending back in the summer of 2011 when a bargain agreement was met between GOP and Democrats in order to raise the country’s debt ceiling. The cap will go into affect on Jan. 1, 2013. It will bring $500 billion in Bush-era tax cuts and payroll tax holidays and $109 billion in automatic spending cuts in defense and domestic spending to an abrupt halt.

A lack of compromise between Democrats and Republicans on the issue will certainly thrust the economy back into a recession.

Leaders do not have time to be lackadaisical in their efforts to work together. If there isn’t cooperation between the partisan split House of Representatives and Senate to pass legislation that will prevent sequestration, then there will likely be major consequences for current college students’ job prospects.

According to a Congressional Budget Office report that was released on Nov. 8, unemployment rates will jump from 7.9 percent this year to 9.1 percent by the end of 2013 if government leaders do not come to an agreement on spending and taxes.

The key to success in solving the impending economic issue is bipartisanship in an effort to both reduce the national deficit and improve unemployment.

One way that can be accomplished is by raising taxes on the wealthiest 2 percent of Americans for revenue purposes. Even conservatives like political strategist and commentator Bill Kristol think that’s a good idea. This past Sunday, Kristol said, “It won’t kill the country if we raise taxes a little bit on millionaires.”
Republican Speaker of the House John Boehner recently said, “I remain optimistic that we can find common ground,” when he was discussing averting the fiscal cliff.

It sounds like the GOP is finally trying to turn an open ear to what the American people want. Exit polls from the Nov. 6 election reveal that 60 percent of voters said they are ready to raise taxes on the wealthiest Americans.

President Obama is listening to the electorate, as well. Last Friday, when speaking about his strategy to solve fiscal cliff, he said the government’s “top priority has to be jobs and economic growth.” The president also said he wants a “balanced approach” to solving the ensuing problem. He also wants to immediately extend middle class tax cuts to “take a chunk of economic uncertainty off the table.” If that tax policy is renewed, it will protect tax rates for 98 percent of Americans. However, the bill has been sitting idle in Congress since it was passed by the Senate.

Passing that bill would be an easy and smart start to cooperation between political parties and saving the economic future of America. If the recent presidential election means anything after the past three years, it is that Americans are ready for their civil servants to start working together.

As they should.

Chase Sanders is a Kernel staff writer. Email him at csanders@kykernel.com.

Chuck: I’ll do you one better. Let’s COMPLETELY eliminate defense spending. Take it to zero. That’s about 800 Billion eliminated from the budget.

That only leaves about 600 Billion of the deficit…raising taxes like Obama wants will generate about 35 Billion (cbo estimate of increased revenue minus increases expenses for the 200k lost jobs and resulting entitlement expenses.)…sooo…

For this year alone, we only have to find an additional 565 BILLION dollars to close the deficit we have this year.

There is no way to raise enough revenue through taxes. Even if we actually allowed domestic energy development and put in place other pro-growth policies, there’s no way to pay for what we’re spending.

So what’s the point in raising taxes? It only hurts the economy and jobs, then again, it makes for good talking points and contenting the masses that our government is doing “something” and making those “rich people” pay for it lol

I agree that taxes should be increased, but I think an immediate second step is to cut defense spending. No other conversations should be entertained until the defense budget is seriously reconsidered.

“raising taxes on the wealthiest 2 percent of Americans for revenue purposes”
That same CBO report say that the tax that Obama wants to increase will result in a lousy $42Bn in 2013 and $38Bn in 2014. That’s peanuts to a government that spends $3.6T a year. The tax increase that Obama is insisting on comes to three days of spending. It comes not solely from “millionaires and billionaires” but from those making $250k and more.

The CBO continues that raising high end taxes will reduce GDP growth by .1% and will result in 200,000 less workers finding jobs. It will do these bad things by the 4th Q of 2013.

But the tax increases are meaningless w/out actual spending cuts. Real “cuts” not just decreases in the amount of spending growth we’ll have next year.
Want to take a stab at how many “compromises” that included tax increases AND spending cuts actually followed through with the spending cuts? lol