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
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.
TEXT SIZE - +
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

Multimedia Relatives of South Korean Ferry Victims Fire at Authorities

46 people are confirmed dead, but some 250 remain trapped inside sunken ferry More

War Legacy Haunts Vietnam, US Relations

$84 million project aims to clean up soil contaminated by Agent Orange More

Wikipedia Proves Useful for Tracking Flu

Technique gave better results than Center for Disease Control (CDC) and Google’s Flu Trends More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Ukraine, Russia, United in Faith, Divided in Politicsi
X
Michael Eckels
April 19, 2014
There is a strong historical religious connection between Russia and Ukraine. But what role is religion playing in the current conflict? In the run-up to Easter, Michael Eckels in Moscow reports for VOA.
Video

Video Ukraine, Russia, United in Faith, Divided in Politics

There is a strong historical religious connection between Russia and Ukraine. But what role is religion playing in the current conflict? In the run-up to Easter, Michael Eckels in Moscow reports for VOA.
Video

Video Face of American Farmer is Changing

The average American farmer is now 58 years old, and farmers 65 and older are the fastest growing segment of the population. It’s a troubling trend signaling big changes ahead for American agriculture as aging farmers retire. Reporter Mike Osborne says a new report from the U.S. Census Bureau is suggesting what some of those changes might look like... and why they might not be so troubling.
Video

Video Donetsk Governor: Ukraine Military Assault 'Delicate But Necessary'

Around a dozen state buildings in eastern Ukraine remain in the hands of pro-Russian protesters who are demanding a referendum on self-rule. The governor of the whole Donetsk region is among those forced out by the protesters. He spoke to VOA's Henry Ridgwell from his temporary new office in Donetsk city.
Video

Video Drones May Soon Send Data From High Seas

Drones are usually associated with unmanned flying vehicles, but autonomous watercraft are also becoming useful tools for jobs ranging from scientific exploration to law enforcement to searching for a missing airliner in the Indian Ocean. VOA’s George Putic reports on sea-faring drones.
Video

Video New Earth-Size Planet Found

Not too big, not too small. Not too hot, not too cold. A newly discovered planet looks just right for life as we know it, according to an international group of astronomers. VOA’s Steve Baragona has more.
Video

Video Copts in Diaspora Worry About Future in Egypt

Around 10 percent of Egypt’s population belong to the Coptic faith, making them the largest Christian minority in the Middle East. But they have become targets of violence since the revolution three years ago. With elections scheduled for May and the struggle between the Egyptian military and Islamists continuing, many Copts abroad are deeply worried about the future of their ancient church. VOA religion correspondent Jerome Socolovsky visited a Coptic church outside Washington DC.
Video

Video Critics Say Venezuelan Protests Test Limits of Military's Support

During the two months of deadly anti-government protests that have rocked the oil-rich nation of Venezuela, President Nicolas Maduro has accused the opposition of trying to initiate a coup. Though a small number of military officers have been arrested for allegedly plotting against the government, VOA’s Brian Padden reports the leadership of the armed forces continues to support the president, at least for now.
Video

Video More Millenials Unplug to Embrace Board Games

A big new trend in the U.S. toy industry has more consumers switching off their high-tech gadgets to play with classic toys, like board games. This is especially true among the so-called millenial generation - those born in the 1980's and 90's. Elizabeth Lee has more from an unusual café in Los Angeles, where the new trend is popular and business is booming.
Video

Video Google Buys Drone Company

In its latest purchase of high-tech companies, Google has acquired a manufacturer of solar-powered drones that can stay in the air almost indefinitely, relaying broadband Internet connection to remote areas. It is seen as yet another step in the U.S. based Web giant’s bid to bring Internet to the whole world. VOA’s George Putic reports.
AppleAndroid