In case you don’t have time to read the news, I would like to sum up one of the main headlines this week in domestic news (yes, the revolts of the century going on in the Middle East are cool too, but one thing at a time!).
Another hot topic is Obama’s plan to cut the federal budget for the 2012 fiscal year. I am not one to usually pay attention to the economy (maybe because I have never taken economics), but I figure better late than never to get an understanding of what is going on.
So here is my attempt to put this whole discussion into layman’s terms so we can all appreciate what it means for our future.
Basically, the most important thing to note is that Obama’s administration is interested in bringing in 1.6 trillion dollars in revenue from taxes in the next decade, which will be quite handy for those of us graduating college and making our own money in the next decade (uh-oh).
The focus of the economy is being altered to highlight education, innovation and scientific research, as well as making high speed internet available for all Americans (hurray for science majors and teachers!).
Over 200 government programs will be cut as well. What is important this week and in the coming weeks is the way in which Obama’s budget shows Congress the priorities of the White House.
Already, Republicans are unhappy that Obama’s plan is more a long-term change to the economy and budget, and not a short-term solution to the deficit that is expected to reach 1.6 trillion dollars this year.
Voting and agreeing on the budget is a very political process, especially this year. This March, it is predicted that the government will exceed its debt ceiling, meaning that we can no longer borrow money to pay off the debt.
Because this is not a good situation to be in, chances are the Republicans who now run the House of Representatives will be pushing their agendas for the budget before agreeing to let Democrats raise the debt ceiling.
If there is no agreement on this, the budget remains undetermined for 2012 and we continue to roll off of fiscal year 2010, the federal government might shut down for a couple of weeks (no big deal?).
The last time this happened was in 1995, when President Clinton was faced with a similar scenario. Since most of the people reading this probably weren’t old enough to appreciate that fun time in history, you should keep your eye on that bundle of joy coming to Washington sometime soon!
At any rate, my personal hope is that the government will go back to focusing more on Medicare and Social Security. Did you know that Social Security is predicted to run out sometime in the 2030’s? I don’t know about you, but I would like to be able to retire comfortably one day.
However, Medicare and Social Security are not voted on in the budget, because they are non-discretionary funds, and therefore the law required to change the rules of the game are much harder and takes much longer to do. Still, a girl can dream.
Lots of things to think about here. I hope this crash course in recent economic developments has been helpful, and perhaps will shape the way in which you think of the coming Presidential candidates who are vying for attention on the media stage. Happy hunting!