News / USA

US Cities Brace for Looming Fiscal Cliff

Michael Bowman
— Looming automatic austerity measures in the United States, the so-called “fiscal cliff," could have a major impact on the economic vitality of towns and cities across the nation. Municipalities fear automatic tax hikes and spending cuts that would take effect January 1, as well as other measures Washington has been debating to avert the fiscal cliff.

Like many American towns, Dixon, Illinois, is still struggling to recover from the 2008 financial crisis and economic recession. Here, unemployment exceeds the national average. Residents are casting a nervous eye on Washington, where President Barack Obama and congressional leaders have been unable to agree on ways to curb America’s runaway national debt.

“I really wonder if they have thought things through,” said Dixon Mayor James Burke, who fears that an eventual deal may limit tax deductions for home owners, which could depress U.S. housing values. That, in turn, would constrain property taxes on which local governments across America rely.

“The big question is: what is going to happen to the housing industry? The housing industry has been the backbone of this economy in this country. I just wonder if the people in Washington really know what they are doing when they talk about that,” he said.

U.S. fiscal cliff repercussionsU.S. fiscal cliff repercussions
x
U.S. fiscal cliff repercussions
U.S. fiscal cliff repercussions
The threat of massive, across-the-board tax hikes and deep federal spending cuts has not spawned action in the nation’s capital. Congress' top Democrat and Republican acknowledge debt talks are deadlocked.

Washington was not always paralyzed by partisanship. In the 1990s, Former Democratic President Bill Clinton worked with a Republican Congress to balance the federal budget. A decade earlier, former Republican President Ronald Reagan worked with a Democratic Congress to reform Social Security, which provides income to retirees.

Reagan’s boyhood home still stands in Dixon, a national landmark and a source of local pride. The Republican icon would be horrified by today's gridlock in Washington, according to Reagan home overseer Ann Lewis.

“I think he [Reagan] would be very unhappy. Were he president today, there would have been negotiations going on long before this.  Because he believed in bipartisan politics,” said Lewis.

Dixon is not alone in fearing fallout from America’s fiscal woes. Severe cutbacks in federal spending, known as sequestration, would impact many programs relied on by cities and towns across the nation, according to Michael Wallace of the National League of Cities.

“Cities have already been through a recession, and have done the hard work to overcome that. What they really need Congress to do right now is just to do no more harm. And failing to do anything on sequestration is certainly harm,” said Wallace.

The Dixon mayor is taking a wait-and-see approach. “The business community has a lot of confidence. Now, whether this fiscal cliff is going to bring all that to a screeching halt, I don't know,” said Burke.

You May Like

Lebanese Media Unite to Support Palestinians in Gaza

Joint newscast billed as Arab world’s first unified news bulletin in support of Hamas-controlled Gaza Strip More

Photogallery Australian PM Alleges ‘Coverup’ at MH17 Crash Site

Meanwhile, Russia's ambassador to Malaysia denies plane's black boxes were opened before they were handed over to Malaysian officials More

Despite Advances in AIDS Treatment, Stigma Lingers

Leading immunologist tells VOA that stigma is often what prevents those infected with disease from seeking treatment More

This forum has been closed.
Comment Sorting
Comments
     
by: Jason He
December 18, 2012 8:58 AM
The congress should take some measures to avert the Lomming fiscal cliff. It will affect US economy even it is a little better now if it happens. I believe they will reach an agreement on the issue.

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
IAEA: Iran Turns its Enriched Uranium Into Less Harmful Formi
X
July 22, 2014 10:26 AM
Iran has converted its stockpiles of enriched uranium into a less dangerous form that is more difficult to use for nuclear weapons, according to the United Nations’ Atomic Energy Agency. The move complies with an interim deal reached with Western powers on Iran's nuclear program last year, in exchange for easing of sanctions. Henry Ridgwell reports for VOA from London.
Video

Video IAEA: Iran Turns its Enriched Uranium Into Less Harmful Form

Iran has converted its stockpiles of enriched uranium into a less dangerous form that is more difficult to use for nuclear weapons, according to the United Nations’ Atomic Energy Agency. The move complies with an interim deal reached with Western powers on Iran's nuclear program last year, in exchange for easing of sanctions. Henry Ridgwell reports for VOA from London.
Video

Video Relic of Saint Draws Catholics Worried About Immigration Issue

A Roman Catholic saint who is a figure of devotion for those crossing the border into the United States is attracting believers concerned about the plight of undocumented immigrants. Mike O'Sullivan reports from Los Angeles, where a relic of Saint Toribio has drawn thousands to local churches.
Video

Video Ukraine Rebels Surrender MH17 Black Boxes

After days of negotiations, a senior separatist leader handed over two black boxes from an airliner downed over eastern Ukraine to Malaysian experts early Tuesday. While on Monday, the U.N. Security Council unanimously demanded that armed groups controlling the crash site allow safe and unrestricted access to the wreckage.
Video

Video In Cambodia, HIV Diagnosis Brings Deadly Shame

Although HIV/AIDS is now a treatable condition, a positive diagnosis is still a life altering experience. In Cambodia, people living with HIV are often disowned by friends, family and the community. This humiliation can be unbearable. We bring you one Cambodian woman’s struggle to overcome a life tragedy and her own HIV positive diagnosis.
Video

Video Nature of Space Exploration Enters New Age

Forty-five years ago this month, the first humans walked on the moon. It was during an era of the space race between the United States and the Soviet Union. World politics have changed since then and -- as Elizabeth Lee reports -- so has the nature of space exploration.
Video

Video Chicago’s Argonne Lab Developing Battery of the Future

In 2012, the U.S. Department of Energy’s Office of Science awarded a $120 million grant to a new technology center focused on battery development - headquartered at Argonne National Laboratory in suburban Chicago, Illinois. As VOA’s Kane Farabaugh reports, there scientists are making the next technological breakthroughs in energy storage.
Video

Video In NW Pakistan, Army Offensive Causes Massive Number of Displaced

Pakistan’s army offensive in North Waziristan has resulted in the large-scale displacement of the local population. VOA's Ayaz Gul reports from northwest Pakistan where authorities say around 80 percent of the estimated 1 million internally displaced persons [IDPs] have settled in Bannu district, while much of the remaining 20 percent are scattered in nearby cities.
Video

Video Kurdish Peshmerga Force Secures Kirkuk, Its Oil

The Kurdistan regional government has sent its Peshmerga troops into the adjacent province of Kirkuk to drive out insurgents, and to secure the area's rich oil fields. By doing this, the regional government has added a fourth province to the three it officially controls. The oil also provides revenue that could make an independent Kurdistan economically strong. VOA’s Jeffrey Young went out with the Peshmerga and filed this report.
Video

Video Malaysia Reeling: Second Air Disaster in Four Months

Malaysia is reeling from the second air disaster in four months involving the country’s flag carrier. Flight 340 vanished in March and despite an extensive search, no debris has been found. And on Thursday, Flight 17, likely hit by a surface-to-air missile, came apart over eastern Ukraine. The two incidents together have left more than 500 people dead. VOA Correspondent Steve Herman reports from Kuala Lumpur.

AppleAndroid