News / Economy

Political Bickering Threatens US Economy, Again

Political Bickering Threatens US Economy -- Againi
|| 0:00:00
...    
🔇
X
July 25, 2012 10:21 PM
A year ago, many Americans were appalled when partisan bickering between opposition Republicans and President Barack Obama’s Democratic Party pushed the nation to the brink of default on its massive debts. The political gridlock prompted a downgrade of the U.S. credit rating. As VOA’s Jim Randle reports, the country now faces even greater financial problems in the midst of a hyper-partisan atmosphere as November's presidential election approaches.
Political Bickering Threatens US Economy -- Again
WASHINGTON — A year ago, many Americans were appalled when partisan bickering between opposition Republicans and President Barack Obama’s Democratic Party  pushed the nation to the brink of default on its massive debts.  The political gridlock prompted a downgrade of the U.S. credit rating.

The country now faces even greater financial problems in the midst of a hyper-partisan atmosphere as November's presidential election approaches.

During the debt ceiling debate, a popular newspaper portrayed leading politicians from the two parties as whining brats in diapers.  

Washington was nearly paralyzed by bickering as it tried to make tough political and financial decisions.

Economist Says US Is Bright Spot in Weak Global Economyi
|| 0:00:00
...    
🔇
X
Mil Arcega
July 25, 2012 11:35 PM
Financial markets stumbled this week as worries about a potential bailout for Spain, weakness in emerging markets, and a looming fiscal crisis in the U.S. gained momentum. Despite the increasingly negative outlook, a New York economist tells VOA the one bright spot may be the United States. Mil Arcega has more.
Related Video Report - Click to View
The squabbling prompted Standard & Poor's to make an unprecedented cut in the U.S. credit rating.

“There had been significant deterioration recently on both the political and fiscal front --  on the fiscal front, in terms of the government indebtedness as a share of the economy, and on the political side in terms of the willingness to arrest that deterioration,” said Nikola Swann, a key S&P analyst.

Economists say the polarization inherent to this year’s election campaigns could make Washington’s dysfunctional politics even worse.

Last year’s congressional debate focused on efforts to raise the legal limit on what the U.S. government can borrow to fund its deficits and debt.

The squabbling worried some investors even when It ended with a deal that put off some tough political and financial decisions.  

So Congress has to deal with the debt ceiling again and also agree on what to do about tax cuts set to expire at the end of this year.  

Without a deal, the government faces drastic spending cuts that will hit both the military and popular social programs.  

U.S. central bank Chairman Ben Bernanke says that could push the nation back into recession.

“If the full range of tax increases and spending cuts were allowed to take effect, a scenario widely referred to as the fiscal cliff, a shallow recession would occur early next year and about 1-1/4 million fewer jobs would be created in 2013,” Bernanke said.

Brookings Institution economic scholar Phillip Wallach says he expects that Democrats and Republicans in Congress will work something out, eventually.
 
“The Republican leadership compromised just enough to make sure they got a deal done at the last minute, and if you were [willing to make a wager] you would probably say that’s what will happen again the next time around because they don’t want to be responsible for plunging the economy into chaos,” Wallach said.

So Congress and the President have just a few months to finish the difficult task of reaching agreement on spending and taxes in ways that do not damage the economy.

You May Like

Video Protests Continue in Ferguson, Spread to Other US Cities

Missouri officials say deployment of more than 2,000 National Guard soldiers helps curb second night of rampant arson and looting in Midwestern town More

Video Ebola, Crackdown on Illegals Hit Business in Guangzhou

Chinese city has largest community of Africans in Asia More

Video Legendary Lebanese Actress, Singer Sabah Dies at 87

Music and film diva, affectionately called 'Sabbouha' by millions of her fans, performed at Carnegie Hall in New York, Royal Albert Hall in London, Olympia in Paris, Sydney Opera House in Sydney More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Aung San Suu Kyi: Myanmar Opposition to Keep Pushing for Constitutional Changei
X
November 24, 2014 10:09 PM
Myanmar opposition leader Aung San Suu Kyi says she and her supporters will continue pushing to amend a constitutional clause that bars her from running for president next year. VOA's Than Lwin Htun reports from the capital Naypyitaw in this report narrated by Colin Lovett.
Video

Video Aung San Suu Kyi: Myanmar Opposition to Keep Pushing for Constitutional Change

Myanmar opposition leader Aung San Suu Kyi says she and her supporters will continue pushing to amend a constitutional clause that bars her from running for president next year. VOA's Than Lwin Htun reports from the capital Naypyitaw in this report narrated by Colin Lovett.
Video

Video Mali Attempts to Shut Down Ebola Transmission Chain

Senegal and Nigeria were able to stop small Ebola outbreaks by closely monitoring those who had contact with the sick person and quickly isolating anyone with symptoms. Mali is now scrambling to do the same. VOA’s Anne Look reports from Mali on what the country is doing to shut down the chain of transmission.
Video

Video Ukraine Marks Anniversary of Deadly 1930s Famine

During a commemoration for millions who died of starvation in Ukraine in the early 1930s, President Petro Poroshenko lashed out at Soviet-era totalitarianism for causing the deaths and accused today’s Russian-backed rebels in the east of using similar tactics. VOA’s Daniel Shearf reports from Kyiv.
Video

Video Hong Kong Protests at a Crossroads

New public opinion polls in Hong Kong indicate declining support for pro-democracy demonstrations after weeks of street protests. VOA’s Bill Ide in Guangzhou and Pros Laput in Hong Kong spoke with protesters and observers about whether demonstrators have been too aggressive in pushing for change.
Video

Video US Immigration Relief Imminent for Mixed-Status Families

Tens of thousands of undocumented immigrants in the Washington, D.C., area may benefit from a controversial presidential order announced this week. It's not a path to citizenship, as some activists hoped. But it will allow more immigrants who arrived as children or who have citizen children, to avoid deportation and work legally. VOA's Victoria Macchi talks with one young man who benefited from an earlier presidential order, and whose parents may now benefit after years of living in fear.
Video

Video New Skateboard Defies Gravity

A futuristic dream only a couple of decades ago, the hoverboard – a skateboard that floats above the ground - has finally been made possible. While still not ready for mass production, it promises to become a cool mode of transport... at least over some surfaces. VOA’s George Putic reports.
Video

Video Falling Gas Prices Impact US Oil Extraction

With the price of oil now less than $80 a barrel, motorists throughout the United States are benefiting from gas prices below $3 a gallon. But as VOA’s Kane Farabaugh reports, the decreasing price of petroleum has a downside for the hydraulic fracturing industry in the United States.
Video

Video Tensions Build on Korean Peninsula Amid Military Drills

It has been another tense week on the Korean peninsula as Pyongyang threatened to again test nuclear weapons while the U.S. and South Korean forces held joint military exercises in a show of force. VOA’s Brian Padden reports from the Kunsan Air Base in South Korea.
Video

Video Mama Sarah Obama Honored at UN Women’s Entrepreneurship Day

President Barack Obama's step-grandmother is in the United States to raise money to build a $12 million school and hospital center in Kogelo, Kenya, the birthplace of the president's father, Barack Obama, Sr. She was honored for her decades of work to aid poor Kenyans at a Women's Entrepreneurship Day at the United Nations.
Video

Video Ebola Economic Toll Stirs W. Africa Food Security Concerns

The World Bank said Wednesday that it expects the economic impact of the Ebola outbreak on the sub-Saharan economy to cost somewhere betweenf $3 billion to $4 billion - well below a previously-outlined worst-case scenario of $32 billion. Some economists, however, paint a gloomier picture - warning that the disruption to regional markets and trading is considerable. Henry Ridgwell reports from London.
Video

Video Chaos, Abuse Defy Solution in Libya

The political and security crisis in Libya is deepening, with competing governments and, according to Amnesty International, widespread human rights violations committed with impunity. VOA’s Al Pessin reports from London.
Video

Video US Hosts Record 866,000 Foreign Students

Close to 900,000 international students are studying at American universities and colleges, more than ever before. About half of them come from Asia, mostly China. The United States hosts more foreign students than any other country in the world, and its foreign student population is steadily growing. Zlatica Hoke reports.

All About America

AppleAndroid

World Currencies

EUR
USD
0.8048
JPY
USD
118.04
GBP
USD
0.6382
CAD
USD
1.1270
INR
USD
61.892

Rates may not be current.