|President Obama in White House Rose Garden|
by Caryn Freeman
As the president unveiled a three trillion dollar debt cut plan the Dow was down two-hundred points on reaction to European market instability largely triggered by instability in US markets. Although market indicators are often used to measure public opinion of the presidents handling of the economy most Americans have little to no investment in the stock market. President Obama vowed to veto any bill that raised the cost of Medicare without raising revenue. “None of the changes I’m proposing are easy or convenient,” the president said. Later in his speech, Quoting President George Washington he reminded the American public that you cannot deal with deficits without raising taxes. The president took the opportunity to remind Congress that “It’s our responsibly to put country before party.”
He asked Congress to do what it takes to cut the deficit and raise taxes. “It’s time to do what’s right,” he explained. In short code the tax code is a mess with 45% of the population paying no tax and while receiving government tax credits. The Super Committee charged with the task of cutting another 1.5 trillion from the deficit but part of that responsibility will likely include restructuring the tax code. With less than two months until the Super Committee deadline it’s not likely the bi-partisan committee agree on policy that would restructure the tax code. How the U.S. spends revenue they do have could have more of an impact on the economy not cutting taxes by ending loopholes and tax credits.With the Bush tax set to retire in 2013 and the payroll tax deduction set to expire at the end of the year. Public outcry could have the most significant impact on tax policy. According to the White House the president’s plan would begin to have an impact on reducing its debt level by 2017. The proposal would hit “primary balance” in that year, where current spending is no longer adding to debt. Under the White House plan, the national debt would fall to 73% of gross domestic product in 2012. If Congress took no action to cut spending, the debt would hit 90.7% of GDP, the White House said.