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Fiscal Cliff Frenzey by Rick Murray, Chief Executive Officer, ASBA
As if the rhetoric from the elections wasn’t enough, now we need to suffer through the fiscal cliff negotiations as both sides have taken a position of trying
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to negotiate a deal through the media. For me, this whole episode is kind of like sausage. I don’t want to know how it’s made. Please just get it done.
The Arizona Small Business Association
Everyone knows we need to reduce spending and increase revenues…a
(ASBA) is the largest trade association
pretty simple formula. Everyone’s ox will be equally gored.
in the state representing 11,000+ member businesses, and over 1/2 million employees in all 15 counties. ASBA members enjoy access to significant group discounts, countless opportunities to do business with each
I hope that by the time this article is published there will be an agreement. As of today, both sides are trying to find a mutual agreement in order to prevent $600 billion in automatic tax increases and spending cuts scheduled to take effect at the beginning of January if no deal is reached.
other, a wide array of insurance
The two major elements of the fiscal cliff are automatic spending reductions (sequestration) set to
products, and active advocacy efforts on
start on January 1 and tax cuts that expire at the end of the year. Further complicating these
public policy issues to protect their businesses. Discover more at www.asba.com.
discussions is the fact that government is expected to hit its borrowing limit in late January or early February, and some Republicans are fearful of further spending cuts before the debt ceiling is lifted. President Obama has said that any deal on taxes and spending must ensure there will not
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be another crisis over the debt ceiling early next year. Boehner’s proposal called for $2.2 trillion in deficit reduction over ten years, with $800 billion
in this issue Business Health Challenge . . . . . . pg. 2
coming from new revenue generated through tax reform that closes special interest loopholes and deductions while lowering rates. The remaining $1.4 trillion would come from cuts to mandatory and discretionary spending programs—including Medicare—on top of those already enacted in the Budget Control Act of 2011. Obama rejected the speaker’s proposal citing that it “does not meet the test of balance” and has
ASBA 2013 Legislative Forcast . . . pg. 4
subsequently argued that the Republican plan lacked specifics and would generate insufficient revenue. He also continued to insist that a final deal would have to include a rate increase for
Web Marketing 101 . . . . . . . . . . . . pg. 6
high-income taxpayers. Instead, the President supports $1.6 trillion in new tax revenue over ten years, plus $400 billion in cuts to federal spending. Democrats, including Obama, want the
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reduced tax rates extended for married taxpayers earning less than $250,000 a year and single
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filers earning less than $200,000, while Republicans want them continued for all brackets.
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combined with serious entitlement reform and additional spending cuts. Once Republican leadership takes that framework, the President feels a balanced plan will be achievable.
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Obama is confident that Republicans may be able to accept some rate increases as long as it is
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Speaker Boehner has called for the President to put forward a revised offer of his own, and argues that he has an obligation to send one to Congress that can pass both chambers. House Majority Leader Eric Cantor (R-Va.), who controls the schedule for that chamber, has indicated that the House will not adjourn the 112th Congress until a credible solution to the fiscal
© 2013 ASBA. A publication of the Arizona Small Business Association. For more information or to join ASBA, please contact us at www.asba.com. Section designed by the Arizona Small Business Association.
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cliff has been found. Let’s only hope. Whatever the solution is…I’m sure it will be one piece of sausage that will be tough to swallow.
J a n u a r y 2013
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