What would be the effect if the tax increases and spending cuts occurred all at once?

A:

It’s unlikely that we’ll go over the “fiscal cliff” without any changes in the mandated tax increases and spending cuts. But if we did, there would be a drop in the budget deficit by $500 billion in 2013 and a corresponding damage to the economy due to this large drop in effective demand. A great deal depends on which programs sustain cuts, how soon these cuts take place and whether or not higher tax rates are imposed on the rich and corporations, but not the working class. Though critical anti-poverty programs are slated for massive cuts if there is no solution, the executive branch could delay the effects of the cuts and tax increases on working people until March 1 or so. Thus, the Obama administration should bargain tough and not rush into a bad bargain. The administration has leverage, as the Right doesn’t want to take blame for tax increases on the middle class and they desperately want to preserve defense spending. 

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Introduction to Democratic Socialism

December 05, 2017
· 83 rsvps

Join Bill Barclay, Chicago DSA, and Peg Strobel, Chicago DSA and national Socialist Feminist Working Group co-chair, on this webinar for an overview of what we in Democratic Socialists of America mean when we talk about "socialism," "capitalism" and the goals of the socialist movement. 1.5 hours. 9 pm PM ET; 8 pm CT; 7 pm MT; 6 pm PT.

This webinar is free for any DSA member in good standing. You need a computer with good internet access to view the PowerPoint slides, but you may participate by audio only.