A Deadline Looms For The U.S
As March 1st nears, chances are you will be hearing the adults around you talking about automatic budget cuts, and what it would mean for them. The word thrown around will be sequestration. What does it really mean?
Lets take a step back...
Now, what would you do if all the money you earn each year plus your savings are less than your yearly expenses? You could either borrow what you need, or cut back your spending, right?
The US Government is faced with just such a situation. Taxes (income) has not been enough to handle the government's expenses -- money spent on military, social security and other public programs. To make up the difference, the government borrowed money from the US Treasury. But it cannot borrow endlessly, and it has hit a limit known as debt ceiling.
Faced with little options, the Government has two choices – raise taxes (increase income) or cut back spending. The right approach to take is the ongoing debate happening in Washington DC.
What is sequestration?
Back in 2011, Republicans demanded spending cuts in exchange for raising the debt ceiling. Since both political parties couldn't agree on what to cut, they postponed the issue and said if they couldn't make a deal by 2013, they would just do automatic cuts of $109 billion every year for the next 10 years. This is known as sequestration.
On New Year's eve 2013, in what came to be known as the fiscal cliff debate, Congress agreed to tax increases on the rich to partially solve the problem. Both parties agreed to look at ways to reduce expenses by March 1st, 2013. But, there is no solution in sight and March 1st is less than a week away!
What will get cut?
Both military and non-military programs will be affected. Spending on important services such as airport security, education programs, scientific research, disaster relief, disease control, food and drug safety, and many others will also have to be cut. Many jobs will be lost and it can affect the recovery of the US economy
However some items such as Social Security, Medicaid, food stamps programs and others will not be affected.
Many industry leaders, and especially the military have been against the automatic budget cuts. How will Congress act? Will it pass a new bill to avoid these automatic budget cuts? The drama continues...
Courtesy: NPR
they have to do work together! otherwise they can`i solve this issue..
If taxes go up the more money charter school teachers will get!!!!
Wow... unbeleivable!
Man! These people need to work together! Our country is on their shoulders and now they've waited to long earlier and now they don't have as much time to decide. I think they should find a solution that is good for the economy and still has the same taxes as before.
Disaster releif, disease control, scientific reaserches, and more all being cut? That doesn't sound very good to me. But then again the government spending and spending doesn't sound the best either.
All they need to do is quit giving to billionaires and businesses
im an australian so i dont no what it means :(
I wish that could happen
It sounds complicated. I wish everyone could just work together to solve issues, but then again, that would be wishing for the impossible.
I agree 100%!! I also think it was smart to cut military spending a little because the U.S. spends way too much money on it. (in my opinion)
I agree. This would change my life completely. They are aiming for the greater good. But why wait until now. Instead of declining slowly. Now we have to make drastic changes. They need to work together.