Why the economy may get worse no matter who wins the election

Unemployment lines may be soon getting longer no matter how the election turns out.

The United States might well be headed for a double-dip recession regardless of who wins the presidential election in November. Two years ago, President Obama convened a bipartisan commission to examine ways to deal with the ballooning federal debt. TheSimpson-Bowles commissionrecommended a variety of fixes including spending cuts and tax reform, but Congress and the president could not agree. The result of the stalemate was a compromise in which automatic spending cuts and tax increaseswere slated to go into effect on January 1, 2013 if Congress did not act. Now, three months away from the deadline, it appears likely that the doomsday plan will become reality.

It has been called “the tax cliff” or “Taxmageddon.” Regardless of the name, the approaching tax increases represent a significant threat to the already fragile economy. According to a new report released this week by the liberal Tax Policy Center, nearly every tax cut passed since 2001 will expire at once leading to double or triple digit increases on January 1. Taxes will go up an average of $3,500. Nine out of ten Americans will see their taxes increase.

 

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http://www.examiner.com/article/why-the-economy-may-tank-no-matter-who-wins-the-election

Tags: economy, elections 2012, obama, recession, Romney, spending, spending cuts, tax, tax cliff, tax cuts, tax increase, taxes, taxmageddon, unemployment