Unresolved fiscal cliff could raise taxes for 90 percent of U.S. families
At first I was surprised to see this on CBS, but then I thought what the heck every network news site likes a good doom and gloom story.
Basically, if they don't renew the "Bush tax cuts" then the middle class is screwed. All this because the libs in Congress are too engaged to their ideas to use the tax code as a tool for social engineering instead of making the cuts permanent. Now we are sitting on the edge of a financial razor that may disembowel the middle class. It wouldn't surprise me that if Obama looses the dems pull the trigger and toast the economy out of spite.
Without actions from Congress, the report says taxes will go up next year by 20 percent, or $536 billion overall. It will hit Americans at every income level including those living below the poverty line. For a middle income family making $40,000 per year, the tax increase is $2,000.
The increases are so large because the nation's biggest tax cuts all expire three months from now on New Year's Day. They include the Bush-era federal income tax cuts, the payroll tax cut that lowered Social Security and Medicare taxes, and several remaining stimulus tax cuts. They all go away January 1 unless Congress and the president reach a deal on the budget.
Many economists are concerned that a tax increase of that size will shock the economy and trigger a recession by reducing the cash taxpayers have to spend. But now, Congress and the president have a firm price tag on what it costs if they don't reach a budget deal after the election.
Story is here