compassion, collaboration & cooperation iN transistion
OLD-ORDER MINDSET of continuous growth ?
AS The United states is on course to topple over the "fiscal cliff" while
Democrats and Republicans reached the broad outlines of a deal but
failed to pass the required legislation in time.
"The fiscal cliff was concocted by President Obama and Congress as a way
of holding a gun to their own heads. The fixing of a deadline for the automatic
imposition of ferocious tax rises and deep spending cuts was supposed to
concentrate the minds of America’s political leaders and force them into
taking the difficult decisions required to start reeling in the country’s truly
terrifying levels of public debt.
The stratagem has failed. There has been no “grand bargain” that addresses
the root causes of the ballooning deficit – rocketing social security entitlements
funded by a too-narrow tax base – just a sticking-plaster settlement aimed at
buying more time.
The detail of the deal, agreed by the Senate two hours after the deadline’s
expiry, reveals its lack of ambition. The income tax rate will rise from 35%
to 39.6% on individual incomes over $400,000 (just under £250,000) while
various deductions and credits will be withdrawn on lower incomes.
AND that WAS IT. There was scarcely a mention of spending cuts of any kind.
Given that the United States has a $16 trillion burden of debt and an annual
budget deficit of $1.1 trillion, this package does NOT even begin to address
the fiscal crisis.
THIS refusal to face up to reality is damaging enough in the eurozone.
In the United States it is infinitely more so. As the powerhouse of the world
economy, America cannot continue to live in denial and expect to maintain
its dominant role. Its current debt trajectory is leading the country to ruination.
US public debt is already close to three quarters of GDP; official figures indicate
that this will rise to 90 % by the end of the decade.
Many economists believe that such a crippling level of public debt
can destroy any prospect of economic growth."
AS one meritorious Professor of Geophysical and Climate hazards
has said in SKY VISION's - Superstorm 2012: Hell and High Water
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