Talks continue about avoiding fiscal cliff
Talks continue in Washington on attempts to avert a combination of steep tax cuts and deep spending reductions known as the fiscal cliff. To head off that crisis, Congress and the President must agree on a more modest deal to reduce the federal deficit. YNN's Bill Carey says one interested observer is offering some advice: No temporary fixes, but tackle the problem head on.
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SYRACUSE, N.Y. -- When it comes to the discussion of a so-called fiscal cliff and the types of steps the nation needs to take, Leonard Burman literally wrote the book. Burman was among the people who founded the non-partisan Tax Policy Center in Washington. He says it's time for a grand deal on tax hikes and spending cuts.
“I think the worst thing that Congress could do is basically just put a band aid on and say, okay, we'll deal with this again in six months or a year. I'm terrified that next December we could have exactly the same conversation and we'll say, well actually, thinks are a lot worse than they were 12 months ago,” said Burman.
There is room, Burman says, to raise taxes on higher income Americans, without deterring economic growth. In the past, he says, tax rates have been much higher and the economy still grew at a healthy rate. But he says costs for government must also be reined in control a burgeoning federal deficit.
When it comes to future deficits, Burman says unless one particular area is addressed, it threatens to bankrupt the federal government.
“Health care costs have consistently grown faster than the rest of the economy and, if that continues indefinitely, we'll be spending everything on health care,” Burman said. “Obviously, that can't happen.”
The economist says democrats were moving in the right direction by setting up a review process to look more closely at the effectiveness and cost of various procedures. But they took away much of the group's authority when the GOP claimed the government was setting up "death panels."
Burman says there must be a debate over what works and doesn't work in health care, especially the 40 percent of Medicare costs spent on patients in the final months of life.
“We have this weird system where, when old people get really, really sick, instead of making them comfortable and letting them die with dignity, we poke and prod them and cut them open and do all these other things and, a lot of times, they die anyway,” said Burman.
Few decisions will be easy, but Burman says the choices made will determine whether the crisis is resolved or whether a more severe crisis is passed on to future generations.
Any deal on averting the fall off the fiscal cliff must be reached by year's end. Leaders in Congress are expressing pessimism that any deal is likely before the final week of December.