The "fiscal cliff" is a politically manufactured crisis that is more like "steps," Zerlina writes in a piece at Ebony, adding that Americans can rest assured that the end of the world is not upon us if a deal between House Republicans and the president isn't reached by the deadline on Dec. 31.
First of all, it's important to understand that the "fiscal cliff" is a politically manufactured crisis and that it isn't actually a cliff at all.Β It's more like "steps" or asΒ MSNBC's Steve KornackiΒ explained, a "fiscal slope."Β Thus, the breathless coverage in the media is somewhat misleading.Β If a deal between House Republicans and the president isn't reached by the deadline on December 31st, rest assured that the end of the world is not upon us.
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However, a few things will happen on this much talked about DecemberΒ 31stΒ deadline. Β First, the Bush tax cuts will expire.Β All of them.Β At the same time, as a result of the sequestration deal last year,Β spending cuts also are triggered.Β Non-partisan experts warn that this combination oftax increases and spending cutsΒ could send the economy back into another recessionΒ if left unresolved.
Ordinary AmericansΒ would feel an impact from the tax increasesΒ immediately, as payroll taxes and the alternative minimum taxes go up. The unemployment rate could go back up to over 9% and economic growth could be reduced by 0.5%.Β And, of course, the stock market would not react kindly to this level of instability in the American economy.
Read Zerlina Maxwell's entire piece at Ebony.
The RootΒ aims to foster and advance conversations about issues relevant to the black Diaspora by presenting a variety of opinions from all perspectives, whether or not those opinions are shared by our editorial staff.
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