The Fiscal Cliff is a situation where Congress and the White House do not want to deal with realities.
Revenue and spending need to be addressed! We as a country are not willing to pay for things, people believe the "Government" is some magical entity with lots of money to spread around. As it is said, there is no free lunch!
In our country, real taxes are generated from economic activity, that means that our market economy generates the resources that are used to pay the taxes. I know that government employees file taxes, but their taxes in many ways is just a bookkeeping exercise as government does not create wealth for the economy. It is only through economic activity that can resolve this issue.
The President does not understand this and his insistence on "sticking it to the wealthy" does not encourage economic growth. Deductions and loopholes need to be closed and we need to have a tax policy that is fair and simple. When tax policy is simple, business and investors can plan better, thus create a stable economy.
When the "state" intervenes in the economy, havoc reigns!
The current recession has its roots in government intervention in the marketplace - sub prime mortgages are a perfect example of government interference in the market place. This President has prolonged the recovery and keeps saying that free market are what got us in this mess. WRONG, Mr. President it was social engineering on the part of the "state" that everyone should own a house no matter what their ability to pay that mortgage might be.
Now, this President believes that solving the deficit involves raising taxes and increased "stimulus" spending is the way to go. The part that makes me laugh is that Unemployment Benefits and Food Stamps can stimulate the economy. All those items do is prevent food riots and some petty crimes from occurring. Stimulus to the economy comes from the private sector and the creation of productive wealth, not transfer payments from the US Treasury.
My solutions are simple and practiced in every household around the world. Trim spending, align revenue with required spending and start to pay down the debt you have.
The last word, anybody who understands "Keynesian Economics" also knows that during the good times that you run a surplus and pay off the debt. Well, it looks like US politicians haven't thought of that for over 80 years since FDR was President.
