The GOP submitted their own proposal today on how to avoid the coming Fiscal Cliff. House republican leaders say their deal will acquire a net savings of $2.2 Trillion.
The recent democratic proposal would like 1.6 trillion in new taxes, not even 400 billion in cuts, and extra spending which is greater than the amount they are willing to cut. In John Boehner’s words, it is “not a serious proposal”.
“Some 230 GOP representatives and 40 senators have vowed to oppose tax increases.” (Money Morning)
“What we’re not going to do is extend those tax cuts for the wealthiest Americans,” said Timothy Geithner. Democrats have also said that they are willing to negotiate. An administration which desires to steal from the wealthy is pushing their plan. The friction between the Democrats and Republicans is very noticeable and many doubt if there will be a resolution before December 31st.
Here is an insightful interview with Timothy Geithner concerning the fiscal cliff topic.
Raising taxes on the wealthy could be a death sentence for the U.S. job market. Raising taxes for the rich (the job providers) limits hiring and ultimately can lead to a higher unemployment rate.
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[column size=”1-2″ last=”1″ style=”2″] As we are on the road to the fiscal cliff, investors and economists predict a possible upcoming recession. Many are ready to invest in the dollar expecting risk aversion to take it’s place in the markets. No matter what happens at the end of the month, we can definitely expect major volatility in the Forex markets as the new year begins. If no fiscal cliff resolution is made between the two parties, the U.S. is facing $600 Billion in tax increases and spending cuts. [/column]
“Right now, we’re almost nowhere” and fiscal cliff negotiations are at “stalemate” John Boehner stated last week. With the new GOP proposal, directly opposed to the Democratic proposal, a “stalemate” is even more evident. In the coming weeks we will likely hear of many clashes between the two parties and could see a relatively volatile market even though it is the month of December.
Please leave your thoughts concerning the coming Fiscal Cliff below.
To read more about the new GOP proposal, please visit this page.
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