Buckle Your Seat Belts – We’re Nearing the Fiscal Cliff

MetroBoston Publication Date November 28, 2012
By Attorney George Warshaw

By now you’ve heard of the Fiscal Cliff, the latest economic doom and gloom anxiety fostered by the ineptitude of government. The words bring to mind visions of taxpayers being herded like cattle, stampeded down a road that suddenly ends high above the Washington Monument. Kaplunk! Down we all go.

Is disaster around the corner or this just more “talk”?

At the beginning of the new year a number of laws will automatically take effect that are intended to reduce the budget deficit by first, increasing taxes for many and second, cutting spending by the federal government.

Taxes. The temporary tax cuts passed by Democrats and Republicans alike during the Bush presidency will expire on 12/31 and the tax code will revert to what it was years ago. That means higher taxes for many if not most Americans.

Federal Spending. Every agency of government is required to cut its budget by 10% thereby jeopardizing benefit programs and delivery of government services, or so many believe.

The Congressional Budget Office, which is a neutral, unbiased government agency, reported that while the effect of this double down would improve long-term economic growth, it is expected to put us back into a recession.

So buckle your seat belts – and let’s see if our politicians show more common sense this time than last. Well, there’s always prayer! ©2012 George Warshaw

George Warshaw is a real estate attorney and author. He represents buyers and sellers of homes and condos in Massachusetts, and prepares wills, trusts, and estate plans. George welcomes new clients and questions at metro@warshawlaw.com.