| Story Views | |
| Now: | |
| Last Hour: | |
| Last 24 Hours: | |
| Total: | |
Bitter divisions make it hard to fix US economic mess
AFTER feisty debates, campaign stops, billions spent on ads and countless candidate “robo-calls,” America has re-elected Barack Obama as Commander in Chief.
Now the real work begins.
The economy is eking out a half-hearted recovery, and housing is slowly beginning to perk up. However, unemployment remains at a stubborn 7.9 percent, investors are skittish and businesses are still reluctant to spend.
What should Obama prioritize over the next four years?
“The first thing the President needs to do is solve the immediate short-term fiscal cliff problem,” says Wharton finance professor Franklin Allen. “The second is to put us on the road to long-term fiscal sustainability,” which will probably involve a reform of Medicare. Third, he suggests, is to decide how to reform the corporate and personal tax codes. And fourth: Figure out what to do about the mortgage market and government-supported enterprises such as Fannie Mae and Freddie Mac.
Allen’s views reflect those of several Wharton professors, who point to the so-called “fiscal cliff” as the highest short-term priority, followed by comprehensive budget reform and a re-thinking of the tax code and some entitlement programs.
“Getting the economy up and running again at full steam is job No. 1.” says Wharton professor of business economics and public policy Robert P. Inman, adding that another round of fiscal stimulus may be needed, preferably in the form of broad-based tax cuts.
To boost jobs, Inman favors federal programs that invest in human capital and skills development rather than infrastructure projects, which he sees as a role for the states.
Long term, bringing the federal deficit under control is a “more pressing” priority. But in the short term, he says, “the main thing here is to not go off the fiscal cliff.”
Avoiding double-whammy
The “fiscal cliff” refers to the expiration of the Bush-era tax cuts with simultaneous cuts in government spending, a US$600 billion double-whammy of austerity that will kick-in on January 1 unless lawmakers find a way to avoid it.
Wharton business, economics and public policy professor Mark Duggan sees the fiscal cliff as a short-term crisis with a long-term opportunity to reform the tax code and bring government spending in line with revenues.
“It gives policy makers a real opportunity to make tax policy and spending a little smarter,” he says. “How are we going to change the tax code? Are we going to try to raise tax revenue as a share of the economy, or are we going to do all the reduction on the spending side? Or are we just going to keep running trillion-dollar deficits?”
More: http://www.shanghaidaily.com/nsp/Opinion…ic%2Bmess/
2012-12-06 17:23:06
Source: http://yeoldefalseflag.com/thread-bitter-divisions-make-it-hard-to-fix-us-economic-mess
Source:
