Think About It…….. October 3, 2012
The Congressional Budget Office has forecast a fresh recession to hit next year if Taxmageddon, a nearly $500 billion tax increase, hits the nation and Congress and the President drive us off the ‘fiscal cliff.’ ….In a new report, Heritage’s J.D. Foster explains that the very fact that we can see a recession coming is shocking in itself. ‘Economic forcasters almost never forecast recessions,’ he says. ….The problem is extremely clear. Congress has left town and isn’t scheduled to return until after the November election when some of them will be ‘lame duck’ politicians. With every day that passes, the economy drags, as the uncertainty of January 1st looms. ….Business owners are looking at next year’s taxes already and thinking they can’t afford to hire. Investors are holding back from expansions and new ventures.
This massive uncertainty is holding back all growth and keeping unemployment stubbornly above 8 percent, while millions more, uncounted, have dropped out of the labor force because they are so discouraged.
Think about this: If you’re a middle class American family, Taxmageddon means that your taxes are going up about $4,100.00 next year. It starts to hit home when you finally realize you are going to have to come up with that extra $4100.somehow. You are going to have to make cuts in your lifestyle to be able to pay this tax increase. ….As Foster said, ‘President Obama ought to demand that Congress should immediately heed his call and return to D.C. The job need only take a few days away from their campaigning.
Americans must be wondering how much more of this ‘recovery’ they can afford. New figures just out from the Census Bureau’s Current Population Survey show that the typical American household’s real (inflation adjusted) income has actually dropped almost 6% during the Obama recovery. Using 2012 dollars (to adjust for inflation) the median annual income of American households was $53,718 as of June 2009, the last month of the recession. Now, after 38 months of this ‘recovery,’ it as fallen to only $50,678 – a drop of over $3,000 per household.
Yet it gets worse. Amazingly, incomes have dropped even more during the ‘recovery’ than they did during the recession. From the end of the recession to the present day, it has dropped $3,040 or 5.7 percent. This begs the question: What kind of ‘recovery’ compares unfavorably with the recession from which it is ostensibly recovering?
Think About It! JCD 10-03-12