Sadly, with the "fiscal cliff" fast approaching, there has not been much progress with regards to finding an approach that really solves the problem of the real "fiscal cliff", our huge deficit and debt. The President and the Speaker met last night, with no progress, since the President still insists on raising taxes on small businesses.
I still support an approach that reduces government spending, and increases revenues by growth in employment and the economy. This is a balanced approach that will get our fiscal house in order and get more people back to work. Instead of compromising, the President is only focusing on raising tax rates on small businesses, and ignoring the spending cuts that must be a part of any real balanced approach.
Facts are important. Here are some facts about our deficit. Two things have driven our deficit. First, government spending has dramatically increased, especially in the last five years. Second, a stalled economy has led to slightly lower government revenues. That's why we can get the deficit under control by reducing government spending, and implementing pro-economic growth activities which will lead to greater government revenues.
In 2009, the deficit exploded. Revenues decreased because the economy went into a recession. Government spending increased significantly because of the President's "stimulus" bill that, in the end, did nothing to stimulate the economy. As the economy has started to recover, revenue has increased. As more people have jobs, more people pay income taxes. As businesses grow and have greater profits, they pay more taxes too.
The President's plan focuses almost exclusively on raising taxes on the "Top 2%" (including millions of America's family-owned businesses) as the solution to all of the deficit problems. Once again, facts are important. It is estimated that raising taxes on those individuals and small businesses would increase federal government revenue by $441.6B over the next 10 years. The federal government spent about $9.693B per day. That tax increase would pay for about 5 days of federal government spending in 2013. And it is estimated it would result in the loss of hundreds of thousands of jobs. That isn't a real solution to our debt.
We need a balanced approach to get our fiscal house in order. I am willing to reach across the aisle, but there needs to be someone on the other side who is serious about getting Americans back to work, and limiting federal government spending growth.
If you have additional questions about the fiscal cliff, please don't hesitate to contact my office.