The 2013 Fiscal Cliff
Background
Americas debt has been growing dramatically for years. The result of this tremendous growth is making the U.S. be dependent on foreign countries, like China, and is making our country's credit rating lower with a result such as the value of bonds. These bonds are used to finance government operations and increase interest rates. The challenge is this: to balance the budget in a way that helps economic recovery and restructures government expenditures. Towards the end of Clintons presidency, the U.S. debt stood at 5.66 trillion dollars. Since then, the debt is heavily increasing. After the recession in 2008, the debt stood at $10.7 trillion dollars. Today, the U.S. debt is over 16 trillion dollars. By the end of 2012, the U.S. government will have more debts than the economy can make in a year. Last year, the federal government spent 3.6 trillion dollars but only took in 2.3 trillion, leaving 1.3 trillion deficit to be borrowed. The top three reasons for these deficits the U.S. is in are Mandatory Spending, Defense Spending, and Non-Defense Discretionary Spending. With the economy having 16 trillion dollars in debt, there is a proposed "fiscal cliff" as Ben Bernanke put it. The fiscal cliff will consist of 600 billion dollars in tax increases and spending cuts. Washington has been proposing ways around the fiscal cliff for weeks but nothing is changing so far. Peter Schiff says "Our economy is so screwed up from years and years and years of bad monetary and fiscal policy that it's going to be painful to correct that problem. But we have to do it."
Event occurring during crisis
In 2001, President Bush and congress passed tax cuts, These cuts went all the way through 2006. The President and the leaders of Congress wanted to rewrite the tax code permanently, but after the 2006 bill there was an expiration date for the bill in 2010. The Republicans lost control of Congress in 2006, them and the Democrats have been slappin each
Americas debt has been growing dramatically for years. The result of this tremendous growth is making the U.S. be dependent on foreign countries, like China, and is making our country's credit rating lower with a result such as the value of bonds. These bonds are used to finance government operations and increase interest rates. The challenge is this: to balance the budget in a way that helps economic recovery and restructures government expenditures. Towards the end of Clintons presidency, the U.S. debt stood at 5.66 trillion dollars. Since then, the debt is heavily increasing. After the recession in 2008, the debt stood at $10.7 trillion dollars. Today, the U.S. debt is over 16 trillion dollars. By the end of 2012, the U.S. government will have more debts than the economy can make in a year. Last year, the federal government spent 3.6 trillion dollars but only took in 2.3 trillion, leaving 1.3 trillion deficit to be borrowed. The top three reasons for these deficits the U.S. is in are Mandatory Spending, Defense Spending, and Non-Defense Discretionary Spending. With the economy having 16 trillion dollars in debt, there is a proposed "fiscal cliff" as Ben Bernanke put it. The fiscal cliff will consist of 600 billion dollars in tax increases and spending cuts. Washington has been proposing ways around the fiscal cliff for weeks but nothing is changing so far. Peter Schiff says "Our economy is so screwed up from years and years and years of bad monetary and fiscal policy that it's going to be painful to correct that problem. But we have to do it."
Event occurring during crisis
In 2001, President Bush and congress passed tax cuts, These cuts went all the way through 2006. The President and the leaders of Congress wanted to rewrite the tax code permanently, but after the 2006 bill there was an expiration date for the bill in 2010. The Republicans lost control of Congress in 2006, them and the Democrats have been slappin each