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
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

Video Russia’s Syrian Escalation Tests Obama’s Crisis Response

Critics once again question whether president has been slow to act on Syrian conflict, thus creating opening for powers like Russia More

Ancient African DNA Shows Mass Migration Back Into Africa

First genetic analysis of ancient human remains in Africa suggests massive migration from north around time of Egyptian empire More

NASA: Pluto Has Blue Sky

New photos also reveal the presence of water ice More

This forum has been closed.
Comment Sorting
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.
Hungary Criticized for Handling of Refugeesi
Henry Ridgwell
October 08, 2015 8:02 PM
Amnesty International has accused Hungary of breaking multiple international and European human rights laws in its handling of the refugee crisis. As Henry Ridgwell reports, thousands of migrants and refugees continue to travel through the Balkans to Hungary every day.

Video Hungary Criticized for Handling of Refugees

Amnesty International has accused Hungary of breaking multiple international and European human rights laws in its handling of the refugee crisis. As Henry Ridgwell reports, thousands of migrants and refugees continue to travel through the Balkans to Hungary every day.

Video Iraqi-Kurdish Teachers Vow to Continue Protest

Sixteen people were injured when police used tear gas and rubber bullets to disperse teachers and other public employees who took to the streets in Iraq’s Kurdish north, demanding their salaries from the Kurdish Regional Government (KRG). VOA’s Dilshad Anwar, in Sulaimaniya, caught up with protesting teachers who say they have not been paid for three months. Parke Brewer narrates his report.

Video Syrian Village Community Faces Double Displacement in Lebanon

Driven by war from their village in southwestern Syria, a group of families found shelter in Lebanon, resettling en masse in a half-built university to form one of the biggest settlements of its kind in Lebanon. Three years later, however, they now face being kicked out and dispersed in a country where finding shelter as a refugee can be especially tough. John Owens has more for VOA from the city of Saida, also known as Sidon.

Video Bat Colony: Unusual Tourist Attraction in Texas

The action hero Batman might be everyone’s favorite but real bats hardly get that kind of adoration. Put more than a million of these creatures of the night together and it only evokes images of horror. Sarah Zaman visited the largest urban bat colony in North America to see just how well bat and human get along with each other.

Video Device Shows Promise of Stopping Motion Sickness

It’s a sickening feeling — the dizziness, nausea and vomiting that comes with motion sickness. But a device now being developed could stop motion sickness by suppressing certain signals in the brain. VOA’s Deborah Block reports.

Video Making a Mint

While apples, corn, and cranberries top the list of fall produce in the US, it’s also the time to harvest gum, candy, and toothpaste—or at least the oil that makes them minty fresh. Erika Celeste reports from South Bend, Indiana on the mint harvest.

Video Activists Decry Lagos Slum Demolition

Acting on a court order, authorities in Nigeria demolished a slum last month in the commercial capital, Lagos. But human rights activists say the order was illegal, and the community was razed to make way for a government housing project. Chris Stein has more from Lagos.

Video TPP Agreed, But Faces Stiff Opposition

President Barack Obama promoted the Trans-Pacific Partnership on Tuesday, one day after 12 Pacific Rim nations reached the free trade deal in Atlanta. The controversial pact that would involve about 40 percent of global trade still needs approval by lawmakers in respective countries. Zlatica Hoke reports Obama is facing strong opposition to the deal, including from members of his own party.

Video Ukranian Artist Portrays Putin in an Unusual Way

As Russian President Vladimir Putin was addressing the United Nations in New York last month, he was also being featured in an art exhibition in Washington. It’s not a flattering exhibit. It’s done by a Ukrainian artist in a unique medium. And its creator says it’s not only a work of art - it’s a political statement. VOA’s Tetiana Kharchenko has more.

Video Nano-tech Filter Cleans Dirty Water

Access to clean water is a problem for hundreds of millions of people around the world. Now, a scientist and chemical engineer in Tanzania (in East Africa) is working to change that by creating an innovative water filter that makes dirty water safe. VOA’s Deborah Block has the story.

Video Demand Rising for Organic Produce in Cambodia

In Cambodia, where rice has long been the main cash crop, farmers are being encouraged to turn to vegetables to satisfy the growing demand for locally produced organic farm products. Daniel de Carteret has more from Phnom Penh.

Video Botanists Grow Furniture, with Pruning Shears

For something a bit out of the ordinary to furnish your home, why not consider wooden chairs, crafted by nature, with a little help from some British botanists with an eye for design. VOA’s Jessica Berman reports.

VOA Blogs