In the fiscal cliff wars, a pivotal battle is raging between Democrats demanding to raise revenue by boosting tax rates on the nation's highest earners and Republicans insisting on eliminating deductions and other tax breaks instead. Which is better for the economy? Analysts say it depends.
Economists generally agree that a simpler tax code with lower rates and fewer deductions, exemptions and credits would help the economy. With fewer tax preferences, people would be more likely to seek the best investments for their money instead of the most lucrative tax breaks. And lower rates would leave them more money to spend. Both would add oomph to the economy.
But ask whether the higher tax rates that President Barack Obama wants would hurt the economy more than curbing deductions, as Republicans assert, and the picture is less clear. While many economists say the economy theoretically would work more efficiently if the tax code provided fewer preferences, many said it would depend on which deductions lawmakers curb -- a complicated exercise in a world where one person's wasteful loophole may be viewed by others as an economic lifeline.
For example, one of the biggest tax breaks is the widely popular deduction for interest on home mortgages below $1 million. Because of it, the government this year will take in $87 billion less than it would if the deduction didn't exist.
That deduction allows many to buy homes they otherwise couldn't afford and is strenuously defended by the housing industry. But critics say it does little to help lower-income people while it encourages others to go into debt for costlier homes than they need -- an activity they say taxpayers should not subsidize.
So, we want to know -- Do you think we willgo off the fiscal cliff and what are you doing, if anything, to prepare? Post your responses on our FOX 5 Atlanta Facebook page, tweet us @GoodDayAtlanta, or email us at goodday@myfoxatlanta.com! We'll read some of your responses during the 9 a.m. hour of Good Day Atlanta.
Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Friday, May 17 2013 6:31 PM EDT2013-05-17 22:31:42 GMT
For decades, Atlantans have woken up to Tom Sullivan on their radios. But you might not know that he's also somewhat of an expert eBay seller, and he's got quite a story to tell.
For decades, Atlantans have woken up to Tom Sullivan on their radios. But you might not know that he's also somewhat of an expert eBay seller, and he's got quite a story to tell.
Friday, May 17 2013 11:28 AM EDT2013-05-17 15:28:00 GMT
They say the third time's a charm, and that's certainly the case for Candice Glover. A third try on American Idol was just what she needed, and on Thursday night she was crowned the season 12 champ.
They say the third time's a charm, and that's certainly the case for Candice Glover. A third try on American Idol was just what she needed, and on Thursday night she was crowned the season 12 champ.
Friday, May 17 2013 11:18 AM EDT2013-05-17 15:18:53 GMT
What's better than Friday? FOOD TRUCK FRIDAY! This week, we got a visit from Masala Fresh Indian Street Food, and just like always, Good Day's Buck Lanford was more than willing to have a taste.
What's better than Friday? FOOD TRUCK FRIDAY! This week, we got a visit from Masala Fresh Indian Street Food, and just like always, Good Day's Buck Lanford was more than willing to have a taste.
Friday, May 17 2013 11:17 AM EDT2013-05-17 15:17:48 GMT
Can you smell what The Rock is cookin' next? He's ready for Fast & Furious 6, which opens in theaters on May 24!
Can you smell what The Rock is cookin' next? He's ready for Fast & Furious 6, which opens in theaters on May 24! The Rock --- who almost never goes by his real name, Dwayne Johnson-- joined Good Day to give us a sneak peek.
Friday, May 17 2013 10:18 AM EDT2013-05-17 14:18:11 GMT
Need some great advice about... well, anything? Ask Wendy! Wendy Williams has a brand-new book (called, of course-- Ask Wendy) that offers advice on all the "drama" in your life.
Need some great advice about... well, anything? Ask Wendy! Wendy Williams has a brand-new book (called, of course-- Ask Wendy) that offers advice on all the "drama" in your life.
Friday, May 17 2013 7:54 AM EDT2013-05-17 11:54:05 GMT
For most women, there's a big difference between the wedding you wish you could have, and the wedding you can actually afford. So how can you have your dream wedding and not break the bank?
For most women, there's a big difference between the wedding you wish you could have, and the wedding you can actually afford. So how can you have your dream wedding and not break the bank? We got some tips from an expert.
Thursday, May 16 2013 11:21 PM EDT2013-05-17 03:21:44 GMT
American Idol Season 12 is almost officially over, and now, all that's left is part two of the giant finale.
American Idol Season 12 is almost officially over, and now, all that's left is part two of the giant finale. Good Day's Paul Milliken never met a red carpet he didn't like-- so who better to break down the final performances of the season live from downtown L.A. bright and early!
Thursday, May 16 2013 10:03 AM EDT2013-05-16 14:03:48 GMT
In the words of Ryan Seacrest, "It's all come down to this." So who's it gonna be: Candice or Kree? (yep, we know that rhymes)
In the words of Ryan Seacrest, "It's all come down to this." So who's it gonna be: Candice or Kree? (yep, we know that rhymes) Good Day's Karen Graham and 94.9 The Bull's Kristen Gates think they know... and they walked you through it on Thursday morning!
