In this article, the author does a good job of explaining why the federal deficit is so large and already nearing the record high for a fiscal year with one month remaining in the federal fiscal year. The last year the government had a surplus was in 2001. Since then, a mix of increased government spending and president Bush's broad tax breaks has seen that surplus plunge into an increasing deficit. I'm interested to see what kind of scheme the President and Congress will come up with to reduce our deficit in the short-run and the long-run. This will ultimately have to incorporate the $447 billion job creation proposal president Obama just proposed.
Instead of coming up with a concrete plan on reducing the deficit, government recently raised its debt ceiling to make sure it didn't default. Rather than crying over spilled milk, government should look at its budget and find areas where they could reduce spending and should raise taxes if necessary. Although they might be unpopular, saving the economic system is more important than getting reelected.
ReplyDeleteWell, when the employment becomes better, people spend more, companies earn more, and the government pays less for unemployment insurance. This might increases the tax income and lowers some of the cost of the government and help eliminate the huge deficit. The good news is the employment is becoming better now.
ReplyDeleteThere really isn't that much of a need to reduce the deficit in the short term. In the long term, once we end the wars in Iraq/Afghanistan and/if we repeal the top levels of the Bush Tax cut the size of our deficit will not be that big of an issue. The biggest problem is that the deficit is a distraction from the use of our fiscal resources to solve our short term economic issues.
ReplyDeleteUnfortunately, and despite the popularity, securing oil reserves will still remain an ever going process as oil companies maintain a high level of influence on capitol hill. To get anything changed you would first need to hit its source, which is politics. However to change politics you need politics. So it'll be a while before anything you like, happens.
ReplyDeleteThe fact that everyone is so concerned about the budget but also the high rate of unemployment puts the government in a very precarious place right now. If taxes were raised across the board, this would help solve the deficit problem, but not the unemployment one. I think that Obama's proposals to trim the budget that are mentioned in this article are good ones. Getting rid of exemptions and loopholes for the richest Americans and big companies who can afford to pay them will help reduce the deficit. Republicans reject these ideas for political reasons, but seeing as they are the ones who are going on and on about the budget deficit, they should definitely reconsider.
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