Fiscal cliff ramifications

[ledboots]

I heard today that if they do not come to an agreement on the budget by December 31, income tax refunds may be delayed until the spring. Tax rates will go up for a lot of people, especially the lower brackets. I can't believe they took a Christmas vacation!

 

[mlp]

I'm not so much worried about temporary delays (not discounting the fact that many people are financially dependent on getting various payments on time), but if this isn't resolved in very short order, it will send the entire country back into a major recession, quite possibly much worse than the one we've just been starting to climb out of.

And that will negatively impact economies around the world.

 

[ledboots]

A patient of mine with a new baby is really worried because her tax refund is about $4000, and this is about half her yearly salary (EITC.) She owes it all and has been putting off creditors, and now she is worried that she won't be able to pay.

I think they will come up with an emergency plan to avoid these kinds of situations.

Luckily, congress's own pay raise was approved today, though, I am so happy there's time for that.

 

[PTree15]

Congress has so aggravated me the last few years. The politicians are more interested in themselves than in doing what is right for the country. I, too, am worried about the economy. Gas and food prices are already rising and if people end up with less money, they will just pull in the reins on spending. I know I will.

 

[mlp]

Luckily, congress's own pay raise was approved today, though, I am so happy there's time for that.

Yeah, at a bare minimum, they shouldn't be receiving a paycheck during periods when they are failing to take action on time. It wouldn't even begin to approximate the financial dilemna of people like your patient, but it might give them a little incentive to get business done.

(Sorry - I was trying to push the *reply* button repeatedly while distracted by one of the critters, so you may have gotten a succession of like/unlike alerts.)

 

[KLS52]

 

[das_nut]

The fiscal cliff would be great for the US budget-wise, except that it would arguably plunge the US back into a recession*.

The "solution" would be to tie budget fixes to an economic indicator, and have the budget reforms (cuts in spending, higher taxes) gradually be phased in when the economy is doing well. This would actually be beneficial for long-run economic health.

But since the average American voter is an economic idiot, don't expect this to happen.

* Those not fond of Keynes may disagree.

 

[ledboots]

The military will have to send out 800, 000 layoff notices on Tuesday if a deal is not struck. That would completely f the military, but maybe my nephew won't have to be deployed next week to Afghanistan after all.

 

[Envy]

Thanks for screwing up the economy.....again.

 

[ledboots]

Thanks for screwing up the economy.....again.

I know, I just want to go and slap some sense into these idiots.

 

[Spang]

 

[das_nut]

^- I assume that the person who wrote that comic has never had to decide between healthcare or food on the table. Pffft.

 

[jwitee]

A set of recent economic reports appears to present contradictory assessments of consumer perceptions about the economic climate. However, taken together, maybe they just underscore the economic uncertainty and confusion that is so understandable at the moment of political brinksmanship.