This isn't going to be the usual post.
On November 7th everyone (well most everyone, save the few that started petitions for their states to secede from the nation) breathed a sigh of relief. Our televisions, news feeds, and social feeds could return to normal. I know I was relieved that I hopefully wouldn't have to "unfriend" anyone else because of their attacks on an opposing view.*
However, we are heading towards another divisive political iceberg. The fiscal cliff. If you don't know what I am talking about, please stop right now and google it. It is too important not too.
Everyone seems to have their two cents about how to solve it. Some believe that we should go over it, some believe that we should make every effort to avoid it. The opinions as to how to ultimately solve it are as diverse as can be.
What we often forget to think about though is how this will affect more than ourselves. We are often quite short-cited when it comes to fiscal matters. This view comes into play on all levels - local, national, and international. Christine Lagarde, the head of the IMF and one of the many women I admire, has finally weighed in on the subject.
She spoke of the possible effects of going over the cliff in terms of what it would mean to us as a nation, and what it would mean to international markets on Sunday's CNN show "State of the Union."
The main points from this interview are that the effect would be monumental - at all levels.
Nationally: The tax rate hike would effect everyone receiving a paycheck. It would cause all legit employees to take home less, and ultimately throw our country back into a recession. The cuts to federal spending would cause federal employers and government contractors to shed jobs and cut hours.
Internationally: The markets would lose faith in all things U.S. Why would international investors throw their money into U.S. companies if they were shedding jobs or if the fiscal environment was unpredictable?
Yes, a short term solution is possible. But Lagarde calls for a more comprehensive approach or the uncertainty will cause U.S. growth to be zero, or worse. And how does Lagarde propose that we get to this comprehensive solution? Are you ready...
Compromise.
“The truth of the matter is that the best way out of this would be a balanced solution,” she said. “The best way to go forward is to have a balanced approach that takes into account both increasing the revenue, which means, you know, either raising tax or creating new sources of revenue, and cutting spending as well.”
Crazy, huh? Revolutionary. If we compromise, we might find a solution.
I knew I loved her for a reason...
*Yes, I know I could have blocked such people. However, I have chosen to unfriend those that attack or belittle others because they believe something different. I believe that I get to choose who I want in my life, and that I don't need that in my life. I choose to respect others and will not tolerate those that are disrespectful. In saying that, I respect if you disagree.
