The fiscal cliff and you

Here's a quick way to understand the battle over the fiscal cliff.

By Charley Blaine Dec 7, 2012 12:54PM

The fiscal cliff sounds like a nightmare. But it comes with real numbers that have real impacts on the lives of most Americans. Here's an in-depth look at them:Fiscal cliff/MSN graphicThe fiscal cliff started to affect business decisions this fall. That's why you saw small declines in manufacturing in Friday's jobs report, for example.

It appears to be a worry for consumers now. The University of Michigan's latest consumer sentiment survey shows confidence dropping to a four-month low. That suggests households are concerned about a potentially sharp fall in their after-tax incomes.

The CBO data suggests they might want to be concerned.

The CBO estimates suggest the 20% of households with the lowest incomes might see their taxes rise by $412.

If you're in the middle 20% of income levels -- between $39,791 and $64,484 -- the average increase would be $1,984. If you're in the top 20% -- $108,267 or above -- the CBO is estimating an average increase of $14,173.

If you're in the top 1% -- with income above $506,210 -- the average increase might be about $120,500.

 

The threat of the cliff is the result of Congress' inability in 2011 to come up with a package that would satisfy everyone. It came after threats of a government shutdown, a downgrade of U.S. debt by Standard & Poor's and a short, intense panic in financial markets that sent the major stock market averages down.

The provisions of the cliff were part of a deal made by Congress in an August 2011 budget bill. It set up a so-called Super Committee of members of Congress and the Senate who were supposed to hammer out $1.2 trillion in spending cuts over 10 years. If they couldn't come up with a plan, then a mandatory combination of spending cuts and tax increases would kick

The Super Committee couldn't agree on a plan, with Democrats and Republicans essentially deciding to wait until after the 2012 election to make decisions.

The CBO sees the cliff cutting the federal deficit but also causing a recession, just as the economy is gaining some strength, that might not end until the end of 2013.


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1894Comments
Dec 7, 2012 10:14PM
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Darlyn:

Your not the only one who has worked there **** off for what little you might have.

But I ask you. Way aren't you pissed that the super rich has been eating your lunch all along and you haven't complained one time about this?

Why is it your complaining about helping some of the people, when the rich doesn't want to give one bit of there millions of income toward paying there share?

Its about time you learn what's really going on here, your not the only one who would like to keep all the money they make, but the very well off get all kinds of tax breaks and if that doesn't work they send there money over seas, maybe if you don't like what's happening with your money, you should start investing in the Cayman Islands..

Dec 7, 2012 10:13PM
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I think if they do this My tax return will go to $0.00. I normally get about $4,000 back. I claim 0 and have a wife and 2 kids. I get the most removed from my check I can and now that still wont be enough. I can really see a political revolution in our near future. I see unrest, riots, and bad things in our future. I also think if they do this increase we as Americans should boycott it and not pay the increase. What are they going to do throw us all in jail and make the tax revenue 0. That wont happen. We should also get rid of the representative democracy because they dont represent anyone, but themselves anyway. We the people should be able to vote on items up for vote as Americans. There is so much technology now we could vote on items say that are 3% of the budget. Then we could stop all th BS loop holes ourselves. With all the technology it would only take a day or so to get the results which is faster than these jokers in congress or should I say regress.   
Dec 7, 2012 10:12PM
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SOCIALISM NOW !!!   EAT THE RICH !!!

Dec 7, 2012 10:12PM
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Nice fear tactics.  We all need to pay more.   But you Rich a-holes are not going to be creating jobs overseas with your tax saving.   Oh, by the way turnips can be bled.

Dec 7, 2012 10:10PM
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I think the liberal media actually won the election for Obama's second term.  I was hoping more people had woken up to the fact that Obama is such a lousy president before this past  November rolled around.  The Republicans were not able to get enough unbiased media coverage, only FOX did that.   Now it is too late and I think a lot of people who voted for Obama are already regretting it.  Get ready America, we are ALL going to be screwed to the wall, and this country is going to go downhill faster than ever.  Sad, very sad.  
Dec 7, 2012 10:08PM
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I think most people are struggling financially.  The thing that people fail to get is the most basic message and that is, if the Democrats and Republicans can't reach an agreement, these are the consequences.  Obama is NOT and I repeat NOT wanting these taxes to come into fruition, his proposal of raising taxes on those earning more than 250K a year is what he is asking the republicans to agree on and that's where the stalemate comes in.  If the Republicans and Democrats don't come to an agreement, the above chart is the consequence.  It's not just welfare reform that we need, but defense cuts as well.  We are fighting too many wars and for what reason?  It's bankrupting us.  Defense spending is one of the largest share of the pie.  Nevertheless, I think people in this country and especially the wealthy who make over a million a year really do need to pay higher taxes.  In some parts of the country, 250K doesn't get you very far.  
Dec 7, 2012 10:07PM
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Hopefully "DOOMSDAY" hits on the 21st. Then these f..kers can all stick their tax increases up their asses. f em' all. Im sick of this sh.t. Ive been out of work since April, and haven't once touched a food stamp. Im on the way to losing my house, mine and my wife's once awesome relationship is crumbling due to the stress. I can't affor dto buy my kids anything practically. Ohhh, but unemployment has decreased. yah right. Thats because it has run out for everyone on it. But people believe this sh.t. F..k it, Im ready to hold hands with my family on the 21st and check out. Of course that would be too easy so i know it won't happen.
Dec 7, 2012 10:05PM
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Until the tax code is reformed for a flat tax or something much simple national sales tax I don't know then we will never solve this rate issue. The economy should not be set up on spending evrything we earn to grow the economy. It should be set up for people to save like a sales tax if you don't need it you are less likely to buy it if there is a national sales tax that makes it more expensive. My only answer is a new tax code of some kind with incentives to save not spend money we don't have.
Dec 7, 2012 10:03PM
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Obama and congress can't manage what they have and they want more.  No way.  Until spending is cut to match current income minus debt repayment they all need to be thrown over a cliff!
Dec 7, 2012 9:58PM
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Though Obummer should never of been voted in. The solution is NOT increase the taxes on the rich, they would just pass it onto us since they own the businesses. The SOLUTION is to get the politicians off their butts and not just Balance the budget, but to CUT it so the taxes we already pay will suffice.
Dec 7, 2012 9:50PM
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Do only people from Mississippi and Alabama comment here. It sounds like a Ku Klux Klan rally. We all need to give up the tax cuts cuts we got.I make 48,000 a year for 4 people and I was doing fine before the tax cuts and I'll make it without them. Quit crying like a bunch of babies and suck it up or go back home and live with your mommies.
Dec 7, 2012 9:47PM
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Obama needs to come up with a budget that has no spending increases & no tax increases to show the electorate that he's serious about solving the federal deficit. He has no business allowing tax cuts to expire, increasing the amount of taxes Americans pay, after he has taken us to this fiscal cliff.  And shame on the elected officials who refused to work together to come up woith budget cuts to decrease spending!

 

 

 

 

Dec 7, 2012 9:42PM
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Gee, since the bush tax cuts and the extension of two years, we have paid over a hundred and fifty thousand less federal income tax. We invested wisely and took the cash return of about nine thousand a year for a fourth vacation. Looks like we will start paying the extra taxes on income from this year at the rate we paid when Clinton was president. Thank you US government for making us the wealthy pay less taxes and increase our income at the expense of people who can least afford it. If you want to believe the wealthy create jobs, how come our unemployment percentage is so high? Jobs sent overseas lost your jobs, unfunded wars created the huge deficit and lower tax rates drained the treasury and welfare is a very small part of your tax expenditures. Wake up folks it is how congress spends your money, run for re-election owing lobbyists and not you. If anyone thinks after ten years of less taxes and same expenses got us into this mess, you are among the very few who understand our fiscal ills. We need fair taxation and those that can pay more should pay more like me.
Dec 7, 2012 9:41PM
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Ibelieve should elimate all homeowner taxes and install a 9% sales taxacross the board for everyone. This tax should beon everything but food shopping. This way all these people who live with Access and other programs can start paying there fair share.

 

Dec 7, 2012 9:40PM
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Didn't anyone pay attention to the fact that starting Jan 1 the bank will charge a 1% fee for every transaction that goes through the bank? That means that when your paycheck gets deposited, one percent will automatically be taken to pay the debt. Every bill that you pay, take an additional one percent from your balance. How are people on social security going to make it?

Dec 7, 2012 9:37PM
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SELF SERVING CAREER POLITICIANS!!! bRING BACK THE GUILLOTINE!!!
Dec 7, 2012 9:29PM
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Ok, this is the way it really is....our government does not know how to balance a budget...they need money they tax us....I can't afford them anymore...they need to take pay cuts, remember?  THEY WORK FOR US NOT THE OTHER WAY AROUND.  Get rid of the special interest groups...get rid of the programs that are really not doing anything...BALANCE THE BUDGET.  We all have to live within our budget...the government or those in charge need to stop taking and start giving back.  Cut back on their special projects that really are not necessary....fed up....don't care of you are republican or democrat....my daughter was a political science major in college...she said that our government officials remind her of 5 year olds arguing on the playground...well said
Dec 7, 2012 9:25PM
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Once again we are on the short end of politics.  Can the Justice Department on behalf of the American People take President Obama and the congressman who ran on saying that they would not raise our taxes to court and then throw them in jail!  Why not, they do it for the ordinary citizen who gets caught lying.

 

Mike Napsey

Dec 7, 2012 9:25PM
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$412 is ALOT of money for someone who receives only Social Security!  There HAVE to be other ways to save money.  I hear of "boondoggles" on the news all the time and it makes me sick how much money is WASTED on questionable projects.  Like for instance paying for Obama to travel on Air Force One to campaign.  He should have stayed at home and taken care of business.
Dec 7, 2012 9:21PM
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I've tried and tried to see things the way Obama see's things and personally I can't get my head that far up my azz!
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