News / USA

Major US Tax, Spending Decisions Could Hinge on November Elections

Major US Tax, Spending Decisions Could Hinge on November Electionsi
|| 0:00:00
X
Michael Bowman
July 29, 2012 9:35 PM
Unless the U.S. Congress acts, most Americans will pay more taxes next year to a federal government forced to slash domestic and national defense spending. Such an outcome would significantly cut the deficit, but could also damage an already-weak U.S. economy. VOA’s Michael Bowman reports, the November elections could determine how the nation proceeds.
Michael Bowman
Unless the U.S. Congress acts, most Americans will pay more taxes next year to a federal government forced to slash domestic and national defense spending.  Such an outcome would significantly cut the deficit, but could also damage an already-weak U.S. economy.  The November elections could determine how the nation proceeds.
 
Last week brought a tantalizing hint of movement in a politically divided legislature.  The Democrat-controlled Senate passed a bill to retain current tax rates on earnings under $250,000 a year.  Democrat Charles Schumer said, “The House should act immediately so the president can sign this bill into law.”
 
But Republicans, who control the House of Representatives, say the measure will die in the lower chamber.  House Speaker John Boehner had a message for President Barack Obama and congressional Democrats. “Mr. President, I tell you what: if you want to show that you stand with American small-business owners, the best thing you can do is drop your plan to increase their taxes on January first," he said. 
 
Republicans want current tax rates extended for all income levels, including the very wealthy, whom they describe as America’s job creators. Senator John Thune said, “The one thing we do not need in the middle of this kind of an economy is a big, fat tax increase.”
 
The Senate’s top Republican, Mitch McConnell, summed up his take on the Democratic agenda by saying, “Taking more money from those who earn it for the government to waste.”
 
Democrats counter that allowing the tax rate for top earners to rise would reduce the severity of automatic spending cuts that will disproportionately affect poorer and middle-income Americans.  President Obama says America's deficit cannot be eliminated by budget cuts alone. “I do not believe you can reduce the deficit without asking the wealthiest Americans, including folks like me, to give up the tax cuts they have been benefiting from for the last decade," he said. 
 
While Republicans portray themselves as champions of businesses small and large, Democrats want voters to view them as defenders of a faltering middle class.  
 
Senator Barbara Boxer said, “Who are you fighting for?  Are you fighting for the people who make a billion dollars a year?  That is who the Republicans fight for.  Or are you fighting for the middle class, the heart and soul of America?”
 
With neither political party able to exert its will, both are waiting for the American people to weigh in at the ballot box in November, and possibly alter the balance of power in Washington.  

Political analyst John Fortier, who examines possible outcomes, said, “If the president is reelected, he will be reelected with at least part of a Republican Congress, the House and maybe the Senate.  We will have divided government, and many of the same fights we are having today over the raising of the debt ceiling and other budget differences will probably be replayed again and again for the next four years.”
 
On the other hand, a victory by Republican challenger Mitt Romney could break the gridlock to the benefit of his party’s agenda, assuming Republicans see further gains in Congress.
 

You May Like

Polls Open in Scotland Independence Vote

As race to persuade undecided voters continues, 'No' voters say they believe life in Scotland will slowly improve, 'Yes' vote not worth the risk More

China to Invest $20 billion In India Amid Border Dispute

Border spat between armies of two countries in Himalayas underlines mutual tensions despite growing commercial ties highlighted by Xi Jinping's high profile visit More

Ukrainian Activist in Despair About Future of Her Country

IrIna Dovgan, accused of being a spy and tortured by pro-Russian separatists, is appealing to UN Human Rights Council to support her country More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
A Dinosaur Fit for Land and Wateri
X
September 17, 2014 8:44 PM
Residents and tourists in Washington D.C. can now examine a life-size replica of an unusual dinosaur that lived almost a hundred million years ago in northern Africa. Scientists say studying the behemoth named Spinosaurus helps them better understand how some prehistoric animals adapted to life on land and in water. The Spinosaurus replica is on display at the National Geographic museum. VOA’s George Putic has more.
Video

Video A Dinosaur Fit for Land and Water

Residents and tourists in Washington D.C. can now examine a life-size replica of an unusual dinosaur that lived almost a hundred million years ago in northern Africa. Scientists say studying the behemoth named Spinosaurus helps them better understand how some prehistoric animals adapted to life on land and in water. The Spinosaurus replica is on display at the National Geographic museum. VOA’s George Putic has more.
Video

Video Iraqi Kurdistan Church Helps Christian Children Cope find shelter in churches in the Kurdish capital, Irbil

In the past six weeks, tens of thousands of Iraqi Christians have been forced to flee their homes by Islamic State militants and find shelter in churches in the Kurdish capital, Irbil. Despite U.S. airstrikes in the region, the prospect of people returning home is still very low and concerns are starting to grow over the impact this is having on the displaced youth. Sebastian Meyer reports from Irbil on how one church is coping.
Video

Video NASA Picks Boeing, SpaceX to Carry Astronauts Into Space

The U.S. space agency, NASA, has chosen Boeing and SpaceX companies to build the next generation of spacecraft that will carry U.S. astronauts to the International Space Station by the year 2017. The deal with private industry enables NASA to end its dependence on Russia to send space crews into low Earth orbit and back. Zlatica Hoke has more.
Video

Video Future of Ukrainian Former President's Estate Uncertain

More than six months after Ukraine's former President Viktor Yanukovych fled revolution to Russia, authorities have yet to gain control of his palatial estate. Protesters occupy the grounds and opened it to tourists but they are also refusing to turn it over to the state. VOA's Daniel Schearf reports from Mezhigirya, just north of Kyiv.
Video

Video China Muslims Work to Change Perceptions After Knife Attacks

China says its has sentenced three men to death and one woman to life in prison for a deadly knife attack in March that left more than 30 dead and 140 injured. Beijing says Muslim militants from China's restive western region of Xinjiang carried out the attacks. Now, more than six months after the incident, residents in the city are still coping with the aftermath. VOA's Bill Ide has more from Kunming.
Video

Video Enviropreneur Seeks to Save the Environment, Empower the Community

Lorna Rutto, a former banker, is now an ‘enviropreneur’ - turning plastic waste into furniture and fences discusses the challenges she faces in Africa with raw materials and the environment.
Video

Video West Trades Accusations Over Ransoms

As world leaders try to forge a common response to the threat posed by Islamic State militants in Iraq and Syria, there is simmering tension over differing policies on paying ransoms. In the past month, the jihadist group has beheaded two Americans and one Briton. Both countries refuse to pay ransom money. As Henry Ridgwell reports for VOA from London, there is uncertainty in the approach of some other European nations.
Video

Video Scotland Independence Bid Stokes Global Interest

The people of Scotland are preparing to vote on whether to become independent and break away from the rest of Britain, in a referendum being watched carefully in many other countries. Some see it as a risky experiment; while others hope a successful vote for independence might energize their own separatist demands. Foreign immigrants to Scotland have a front row seat for the vote. VOA’s Henry Ridgwell spoke to some of them in Edinburgh.


Carnage and mayhem are part of daily life in northern Nigeria, the result of a terror campaign by the Islamist group Boko Haram. Fears are growing that Nigeria’s government may not know how to counter it, and may be making things worse. More

AppleAndroid