If Congress does not act by the end of this year, a series of automatic tax increases and spending cuts will go into effect on January 2, 2013 – the fiscal cliff. The year-over-year changes for fiscal years 2012-2013 include a $393 billion increase in taxes and an immediate $110 billion single-year reduction in budget authority.
A dramatic increase in taxes and reduction in spending is likely to put the country’s economic recovery in jeopardy. Federal Reserve Board Chairman Ben Bernanke has warned that driving off the “fiscal cliff” would push the U.S. economy back into recession, resulting in the creation of 1.25 million fewer jobs in 2013.
The sooner Congress acts to solve the issue, the better off the economy will be. The mere anticipation of the fiscal cliff has spooked markets and caused businesses to put off investment and hiring decisions.
The nation’s leaders must develop a long-term plan that addresses America’s excessive spending – particularly entitlement spending. The issue is a daunting one, but that factor cannot serve as an excuse for inaction. A comprehensive deficit reduction plan will give the economy space to recover in the short term while long-term spending reforms will strengthen the economy to promote future growth.
However you don’t have to sit on the sidelines while this debate goes on in Washington, D.C. You can make your voice heard by taking a moment to write to your Congressman and two Senators urging them to avoid the “fiscal cliff” now. The whole process is simple and will only take a couple of minutes.
Click here to send your letter. All you need to do is fill out your information, view the pre-written letter and send it to your elected officials. While the letter provides suggested text, please feel free to personalize it to more accurately reflect how the fiscal cliff could harm your business, the industry and your clients.
With the combined voices with FSI’s 35,000 independent financial advisor members we can make an impact. So please take a moment today to send the letter to your elected officials.