America is moving closer to falling off the dreaded fiscal cliff, but Congress continues to move at a snail's pace in addressing the pressing subject.
And while the nation waits for a resolution, the costs of doing nothing are rising, with U.S. taxpayers' money at risk.
Lawmakers have taken a "hurry-up-and-wait" stance, putting off until after the November presidential election any decision-making about the most crucial matter currently facing Congress.
At issue is whether to extend some or all of the Bush-era tax cuts and how to handle the nearly $1 trillion in spending cuts slated to kick-in starting Jan. 1.
If the expiration of tax cuts comes to fruition, the result will be the biggest tax increase ever levied on Americans (Taxmageddon 2013).
If the spending cuts start rolling out, thousands of jobs will be lost, our country's security will be put at risk, businesses will sorely suffer and programs that rely on government contracts will disappear.
With just a few weeks before ballots are cast for our next president, the looming fiscal cliff has become a heated topic on campaign trails. Falling off the cliff would undoubtedly thrust the struggling U.S. economy into a recession in 2013, a consequence neither contender wants to tackle.
So how do they plan to avoid the fiscal cliff? Let's take a look.
President Obama's Fiscal Cliff Approach
U.S. President Barack Obama wants to avoid the ominous automatic broad-based spending cuts.
President Obama wants to see them replaced with "a balanced approach to long-term deficit and debt reduction," according to White House spokesperson Jay Carney.
By a balanced approach, Team Obama means cutting out programs where possible, reducing waste, making the government leaner and more efficient, and asking the wealthy to pay more.
The president also lectured in an interview with Face the Nation, "We've gotta make government leaner and more efficient. But we've also got to ask people-like me or Gov. Romney, who have done better than anybody else over the course of the last decade, and whose taxes are just about lower than they've been in the last 50-years - to do a little bit more."
According to statements from the White House Budget Office, President Obama would likely veto any bill that attempts to avert the defense cuts, as well as any bill that "fails to ask the most fortunate Americans to pay their fair share" (pay more taxes).
These positions have sparked harsh criticism and concerns about the state of our national security. They've also been labeled as unfairly placing the burden of deficit reduction on the wealthy through tax increases.
While the incumbent president has shied away from using the term "veto," he has pushed for Congress to "work on those things we can agree on." They include the extension of Bush tax cuts for the bulk of Americans - the 99% -- while increasing taxes for the 1%.
But to date, no agreement has been reached.
Another area in which the president has not been clear on is the temporary 2% payroll tax cut put into action at the end of 2010.
Earlier this month, Carney said in a vague statement, "We'll evaluate the question of whether we need to extend it at the end of the year when we're looking at a whole range of issues."
Romney Fiscal Cliff Rescue Plan
Romney has repeatedly made it known he does not support any cuts to defense spending and he favors an extension of the Bush-era tax cuts for all.
In addition, he has vowed to balance the mushrooming fiscal deficit within eight years without raising taxes or reducing defense spending.
"I would like to be able to deal with these issues on a structural basis, on a permanent basis as opposed to a stopgap effort that would require unraveling and re-evaluation," Romney said in a May interview with Time Magazine.
The GOP presidential hopeful told Time that if elected he hopes President Obama and Congress will put off the tax increases and spending cuts for up to 90 days so that his new administration and the incoming Congress is afforded time to tackle the issues.
The economy and job creation are major issues for scores of Americans, and here Romney was thought to have a slight edge. But his recently leaked comments about how nearly half the country doesn't pay income taxes may have damaged that lead.
"There are 47 percent of the people who will vote for the president no matter what," Romney said to donors in footage from a private fundraiser held in May. "All right, there are 47 percent who are with him, who are dependent upon government, who believe that they are victims, who believe the government has a responsibility to care for them, who believe that they are entitled to health care, to food, to housing, to you-name-it. [M]y job is, is not to worry about those people. I'll never convince them they should take personal responsibility and care for their lives."
Basically, it looks like if President Obama serves another term, taxes are going up and spending cuts are imminent. Romney says he won't act that way, but that leaves Republicans with a great deal to unravel.
In the end, it will be voters who determine how to resolve fiscal cliff 2013 by how they cast their ballots.
Related Articles and News:
- Money Morning:
Fiscal Cliff 2013: The Biggest Threat To Your Profits? - Money Morning:
Fiscal Cliff 2013: All Talk, No Answers - Money Morning:
Fiscal Cliff a Much Bigger Threat Than Most Investors Think - CNN Money:
Obama vs. Romney: How they'd handle the $7 trillion fiscal cliff - ABC News:
Mitt Romney is Losing Support in These Three Key Swing States - Time Magazine:
The Romney Interview Transcript-the Fiscal Cliff - Face the Nation:
Obama won't compromise "balanced approach" on budget, despite gridlock
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