Whenever I hear the media refer to the upcoming 'fiscal cliff' there is only one thing I think of:
Yup...that's Obama and Boehner...holding hands and heading off a cliff, with the taxpayers running after them: 'No...Wait! You need to actually do your F-ing job and make some tough decisions for once! You can't keep kicking the can down the road to the next Congress or President. You guys wanted to be where you are...now DO SOMETHING!!!!!'
Or something like that.
As Federal Contractors, the whole 'fiscal cliff/sequestration' thing is more than a slight concern. At home, I'm kind of using it as an excuse(okay, it's not an excuse...it's a real worry) to not do anything super serious about buying a house until after the new year.
I would hate to see us hit the automatic tax increases and spending cuts just because that is LAZINESS on the part of our elected leaders, not because it's not needed. The problem is sooooooo bug right now, I don't think it can be fixed by JUST cutting spending, or JUST increasing taxes on 'the rich'. What would I do if I was in charge?
Glad you asked.
We NEED to cut spending. As someone who has worked for The Man one way or another most of my adult life, I think the 10% cuts that 'sequestration' would bring about is a good start. I'm convinced there is enough slop and inefficiency at ALL levels of government that a 10% cut would not result in much decrease to services provided. We can also roll forward with pay freezes....but that's just a place to start. Payroll is a very minor portion of spending, and a lot of our spending can't be touched without totally breaking our promises(pensions and retirement) that folks have been counting on...and I don't think you can do that without some warning. That doesn't mean you can't start telling folks like me, in our mid 30's, that we need to start making some other plans.
I haven't needed to be told. I've already connected the dots...I'm not going to get to retire, not in the traditonal sense. My big hope is that someday I'll be able to take the easiest, lowest paying job with the best benefits.
As far as increasing the revenue stream(can't say raising taxes)...it needs to be done, but it can't just be on the rich. What would really make me smile is a non-confusing flat tax...I think where a lot of folks get mad is the perception(and reality) that rich folks with better lawyers and accountants, get away with paying less taxes than the 'middle class'. A flat tax would with minimum(no) deductions and loopholes would fix that.
Finally, you can't have folks with a negative tax load. I have some family members in the Northeast under this plan...4 kids, one income, and I know they are getting income tax money back that they didn't pay.
Now...I don't argue that these changes won't hurt...they will. A 10% spending cut will mean people let go. There will be less money in the economy, and we might dip back into recession...but it's either slightly painful now...or really painful later. The game of russian roulette comes from 'how much later'. Would it be 8 years as our bond rating suffer, or could we limp along another 30 years? Either way, it's going to happen right as my daughters are trying to live their lives...and call me idealistic, but I think we owe it to them to start fixing things now.