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Americans Should be Bracing for a Potential Tax Tsunami of $720 Billion by 2013
It’s been suggested that all the attention being given to the financial crisis in Europe is intended to district from what’s happening here at home. Certainly looking at someone else’s problems makes yours seem smaller – even if the size of your problem happens to be a potential tax tsunami of 720 unavailable billion. By now, perhaps many realize that this man-made tidal wave includes debris such as “an end to the temporary tax cuts enacted during the George W. Bush administration and to temporary Obama administration payroll tax reductions. Spending cuts in defense and on federal programs were negotiated as part of last summer’s pact to raise the debt ceiling,” as The Christian Monitor put it this weekend.
It was also pointed out that businesses see the behemoth wave making its way across the US, and so financial analysts are projecting that there will be yet another recession in 2013. When the last one actually ended is anyone’s guess. However, the notion that it never ended in the first place is apparently politically incorrect thinking that causes a kind of violent rejection of reality that interferes with the utopian opium of socialist-communists. Besides, that $720 billion is supposed to be a worst case scenario…in a nation that’s already bankrupt.
Even so, Bernanke felt the need to sound the financial disaster air raid siren in an apparent attempt to get Congress to take some unified action. Maybe something like set up some sandbags to break the momentum of the proverbial oncoming tsunami.
But if worse comes to worse and Obama is not successful in getting people to believe that it’s Bush’s fault and also the present Republicans in DC, then Europe might make an effective scapegoat. Especially since Spain is asking for about 100 billion euros in bailout money, according to Reuters. Since we’re all interconnected these days, Europe’s tsunami is America’s tsunami, and America’s tsunami is Europe’s. America’s 8.2 percent unemployment rate looks pretty good when put up against Spain’s 25 percent unemployment – until people start to consider that America’s 8.2 doesn’t include people who are no longer getting benefits. Another reason a big deal has been made about Spain is because they are Europe’s fourth largest economy.
And then there’s Italy. There hasn’t been much out there lately about Italy, but it is in as much trouble as Spain. There was talking last year about not only a bailout for Italy, Europe’s third largest economy, but also that the EU and IMF were going to audit the Italian government. Hopefully, Ron Paul will be carefully watching how they make that happen. Italy is apparently Europe’s scapegoat in that eurozone leaders have said that if Italy collapses, it will be the end of the euro, according to RTE News. Though people have tended to rush to the dollar and to gold in the past when scary things are happening with the euro, America cannot continually increase its debt and expect to escape its own eventual economic crisis.
It’s not an accident that the Wall Street bailout bill kicks in in full force on January 1 of 2013 and that Bernanke has brought up America’s fiscal cliff again. Especially when one recalls that Chris Dodd, one of the bill’s authors, said that, “It will take the next economic crisis, as certainly it will come, to determine whether or not the provisions of this bill will actually provide this generation or the next generation of regulators with the tools necessary to minimize the effects of that crisis.”