President Obama and House Speaker John Boehner are in talks in order to avoid racing down the “fiscal cliff.”
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To avoid the “fiscal cliff,” CNN reports that:
The two sides have until the end of the year to negotiate a budget-cutting deal to prevent middle class tax cuts from expiring and massive across-the-board budget cuts from taking effect. Democrats have largely favored raising taxes on wealthy Americans, while Republicans insist the solution comes in cutting federal spending.
As a solution, Obama has proposed an immediate extension on tax cuts for people earning less than $250,000 a year and that top earners pay more in taxes. He is reportedly working to enlist outside support for his position.
On the contrary, John Boehner and House Republicans reject the idea of raising the tax rate on high-income earners and instead want to cut government entitlement programs. If an agreement is not reached by the end of the year, the economy could be doomed and head into another recession.
Bloomberg reports:
Without new legislation, a combined $607 billion in tax increases and spending cuts — evenly divided between military and domestic spending — will take effect starting in January. The resulting so-called fiscal cliff might push the economy back into recession. The fiscal cliff stems from a standoff between Obama and Congress over how to curb soaring U.S. debt through a mix of tax-code changes and cuts to federal spending.
Yesterday, both Republicans and Democrats seemed confident that a deal could be struck by the deadline to avoid tumbling over the so-called “fiscal cliff.”
