Closing the Deficit

Credit: Amac.us

What could be the best way to close the deficit?  Is it going to be raising taxes on the rich? Cutting spending for the elderly, education, and the poor?  It's going to take a little bit of everything.  The federal government's spending has gotten out of control.  The feds are running trillion+ dollar deficits and both parties of Congress have not come to a real agreement of how to stop the deficit from growing bigger.  The Baby Boomer population is retiring faster than new workers can take their place.  There's also less people working now than before the recession, so that's putting a damper on revenue as well.

As part of the fiscal cliff deal, taxes were raised on the wealthiest earners and the social security tax was raised as well for everybody.  Republicans are saying that is enough tax raising on American citizens, but the Democrats keep pushing for more.  Democrats are proposing that the "Sequester" be replaced with more tax revenue and more broad based cuts versus just spending cuts alone.  The Republicans should stand firm and let the cuts happen, because everybody knows you can't just tax your way out of a deficit.  In the future higher taxes may be an option for closing the deficit, but right now the economy is not strong enough to make higher tax revenue sensible.  The bigger focus should be on giving businesses incentives to higher more workers, which in turn will create higher tax revenue for the federal government.

While spending has slowed in the past few years, it's still on an upward trend.  Yes, any sort of spending cut is going to hurt somewhat, but it needs to be done to save the country from future pains of too much debt.  The Democrats need to start taking it more seriously, in order to get America in fiscal order.  It will have to truly be all the way across the board as well.  From defense, to Medicare/Medicaid, to Social Security, and other discretionary spending.  It can be argued how much Obama's stimulus package really helped, but this sort of spending can't be kept up forever.

If any business were ran like the federal government is today, they would have gone under a very long time ago.  Investors would have pulled out all their money, and people in general wouldn't be interested in giving more money than what the services they receive are worth.  Congress has to work together, and come up with a plan where everybody feels it will be what's best for the country, no matter how politically suicidal it is.  Are members of Congress willing to risk their jobs for the good of the people?  Most of us feel we already know the answer, but hopefully politicians will prove us wrong.