Dr. Boozman's Check-up
The clock is ticking. November is about to be in the rear view mirror, which puts us closer to the fiscal cliff everyone in Washington is frantically trying to avoid.
So where do we go from here?
We’ve got to breathe some certainty into the economy. Right now, people don’t know what their taxes are going to be in the future. Nobody knows what their health care costs are going to be. The same can be said about their energy costs. This has an extremely negative impact on our economy. And if you are looking at it through the lens of a small business owner, this uncertainty means it is unlikely that you will be hiring any new employees and expanding your operation.
In order to get the economy going again, we need to address this crisis. However, the idea of increasing tax rates that is being floated by President Obama and the Senate Majority is the wrong way to go about it. Raising taxes is never wise policy, especially at a time when our economy is still struggling to recover from the last recession. These proposed tax rate increases will hit our small businesses hard. Approximately 60 percent of those impacted by this proposal are small businesses that file as individuals. This proposal is the wrong road to go down, particularly when that road could dead end in another recession.
I am open to pro-growth tax reforms that generate revenue by making our tax code fairer and simpler. There certainly are loopholes that need to be closed. We need to overhaul the tax code, instead of merely raising the top rates.
At its core, the idea that we can tax our way out of this mess does not reflect the reality in Washington. There isn’t a revenue problem here. There is a spending problem. We have got to start by acknowledging that much. If we want to steer clear of the fiscal cliff, it is going to require significant spending cuts. I don’t mean across the board sequestration cuts, but rather smart reforms that target wasteful spending, duplicative programs and ballooning entitlements. The focus needs to be on promoting efficient and effective programs.
I want to stress, however, that there is reason to remain positive about these negotiations. I truly do believe that both parties are working in good faith to ensure that we do not fall off the impending fiscal cliff. We are just starting from completely different points. I am confident that there is common ground to be found.