Captain Rick: The ‘Fiscal Cliff’ is a monumental financial challenge that faces the U.S. and all Americans on January 1, 2013. $7 Trillion in tax increases and spending cuts will begin. The only thing that can stop them from taking affect is for congress and the president to come to an agreement before January 1, 2013. That is not likely with America’s current slate who are in gridlock. A change of faces in D.C. as a result of the November election could improve matters.
Short of a miracle to break Washington D.C. gridlock, on January 1, 2013 the $7 Trillion ‘Fiscal Cliff’ will take place. This is what I anticipate:
Defense will be cut $55 billion in 2013, 10%. I believe our defense department is overloaded with inefficiency and waste beyond 10%. Perhaps this will help our defense department to become more efficient in the expenditure of tax payer funds.
Non-defense will be cut $55 billion in 2013, 10%. Non-defense includes education, Medicaid, food inspections and air travel safety and Medicare. Perhaps this will help all of these departments to become more efficient in the expenditure of tax payer funds.
Bush era tax cuts will end. These tax cuts were stupid and reckless and should never have been implemented. In view of the poor state of the American economy, they should end.
Obama’s Payroll tax holiday will end. The Social Security tax rate reverts to 6.2%, up2%. This tax cut was stupid and reckless and should never have been implemented. It has robbed the Social Security trust fund and shortens the time before the fund become insolvent. This reduction was stealing promised receipts from Social Security trust fund of all elderly Americans. This tax holiday must end.
Unemployment benefits will revert back to the old norm of 26 weeks, down form the current 99. It worked for the better part of the last century. It can work again. The solution to put America back to work will not be accomplished by providing long term unemployment benefits. We need a plan to grow our economy, which will create new jobs.
Medicare Doc Fix expires. Payment to care providers will drop 2%. This is not a problem for people on original Medicare…only those that subscribe to the plans offered by the insurance companies…ones I think should be put out of commission or figure out a way to provide Medicare for the same price the government pays for original Medicare…without the 20% subsidy the insurance companies are receiving now.
The bottom line is that America has been floating on so much fat for so many years. We can and should give up the fat. The ‘Fiscal Cliff’ will have a large impact on those who abuse tax dollars. It will have a minimal effect on honest, hard-working Americans.
It is no secret that America has been living ‘high on the hog’ … well beyond its means for many years. The time has come to pay the price. We either do it now in a constructive manor or pay a much steeper price later…one that could convert the United States of America to a third world country in the not to distant future.