After the American Century
We hear every day about the "fiscal cliff" but this metaphor is all wrong. US government finances will not suddenly decline if Congress does nothing. Rather, they will increase, as the tax rate returns to what it was before Bush pushed through tax cuts that undermined the budget. People seem to have forgotten that in the Clinton years, when taxes were a bit higher, the economy did extremely well. The US at that tax level still had lower taxes than almost anywhere else in the industrialized world.
In short, it is a good thing to go back to the tax system before Bush. The government needs to pay off its debts. The wealthy need to pay their share, again, as they did before. Americans have lost touch with fiscal reality, if they think that taxes can stay as low as they have been.
I realize many people fear that rising taxes will hurt the economy, but one has to remember the harm done by taxes so low that the government just keeps borrowing money. The interest rates are low now, so the dangers are not as obvious as they will be when interest rates rise, as they always do.
The Bush tax cuts were not good for the American economy, and there is no reason to keep them. Short term, this may cause a slight dip in the economy, but long term, living within your means is always a good idea. The Clinton tax rates were much more realistic, and the economy then was far more sound.
