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How’s that for debt reduction?

December 13, 2012
The Daily News

EDITOR:

What is the fiscal cliff? Most politicians and pundits refer to the fiscal cliff as meaning major tax increases combined with across the board spending cuts that our government has thrust upon us.

The real "fiscal cliff" is the Mt. Everest of debt that is right in front of us.

Both Republicans and Democrats are bickering over pennies when they should be negotiating dollars.

Let's assume that President Obama gets everything he wants in tax increases and that Speaker Boehner gets all his proposed spending cuts, where would that leave us?

We are projected to incur approximately $1.2 trillion dollars more debt each year for the next several years. At current growth rates, Obama's new taxes, ($1.6 trillion over 10 years), will net us $0.16 trillion per year and Speaker Boehner's cuts will net us $0.14 trillion per year in reduced spending or a net of $0.3 trillion per year.

These proposed "fiscal cliff" remedies leaves us incurring roughly $900 billion per year of new debt. At George W. Bush's worst, he was incurring $500 billion per year, which then Senator Barack Obama called "unpatriotic."

If $500 billion per year is unpatriotic, what does that make Barack Obama?

To put the "fix" for the fiscal cliff into perspective consider this. Let's say your family is spending $10,000 more a year than it makes and your credit card balance is $160,000.

You decide that you're going to pay down your credit card debt or at least stop the bleeding. You ask your wife to increase her hours at her part time job from 20 per week to 24 and from this you net an additional $1,000.

Additionally, you decide to give up going out to eat at least once per week and going to sporting events by at least once per month for an additional savings of $1,500.

Congratulations, you've accomplished what our government cannot, which is that now you are only adding $7,500 per year to your credit card debt of $160,000. If you add interest, even at a low 3 percent, you will have amassed a credit card debt of $303,235 after 10 years. How's that for debt reduction?

If you think the "fiscal cliff" is scary consider this final analogy. The notional "fiscal cliff" is Pine Mountain compared to the real fiscal cliff of Mt. Everest. Throw the bums out.

Gary Merrill

Florence, Wis.

 
 

 

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