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The Fiscal Cliff: What Deal Would You Cut?

Massachusetts Democrats in Congress want to avoid cuts in benefits as part of any deal, but proposals such as raising the eligibility age for Medicare are still on the table. What would you do?

As Congress negotiates a deal to avoid the so-called "fiscal cliff" on Jan. 1, Massachusetts' congressional representatives have voiced their opposition to any cuts in benefits such as Social Security, Medicare and Medicaid, the Boston Globe reports.

However, there are proposals still on the table that would change those benefit programs, including linking Social Security benefits to a more conservative inflation index that would slightly reduce annual increases, or raising the eligibility age for Medicare from 65 to 67.

The Globe reported that while the Bay State's legislators were united against changes to Social Security, there's some wiggle room on Medicare. Rep. Ed Markey opposes raising the Medicare eligibility age; Rep. Michael Capuano would consider raising the age in trade for higher tax rates on the wealthy; and Rep. Richard Neal would consider raising the eligibility of Medicare by one month a year.

The fiscal cliff is partly a result of a deal struck in August 2011 to raise the debt ceiling. On Jan. 1, the Bush tax cuts would expire, as would extended unemployment benefits and a payroll tax cut. There would also be $1.2 trillion in spending cuts, an automatic reduction if a joint Congressional committee couldn't come up with a list of cuts to present to lawmakers for approval.

Without a deal to avert the fiscal cliff, a White House report says that a Massachusetts family of four, earning $86,000, would see its income taxes rise by $2,200, the Globe reports.

Some pundits have advocated going over the fiscal cliff—not striking a deal, allowing the tax cuts to expire and spending cuts to go into effect on Jan. 1—as a way to strengthen their side in tax negotations or to rationalize the tax code.

The Tax Policy Center has created a calculator that shows the effect the fiscal cliff would have on different households, and allows comparisons with alternative tax policies presented by both Democrats and Republicans.

What deal would you strike to avoid the fiscal cliff? Which tax cuts would you keep and which would you allow to expire? Would you raise the eligibility age for Medicare? Agree to Social Security changes? Or advocate going over the fiscal cliff? Tell us in the comments.

Bob December 30, 2012 at 01:05 PM
Tyler, maybe you need a civics lesson. The people returned control of the government pocketbook to the Republican's (House of Rep.) to control President Obama's out of control spending. He has offered 3 budgets to the Senate (with Dem control) and gotten exactly ZERO votes of support.
Bob December 30, 2012 at 01:11 PM
Or tie our employees incomes (ie. public employees) to the average income of their employers? Average salary for public employees are almost twice that of private sector. Upside down! PLUS they get the kiss in the mail when they retire.
Who Me? December 30, 2012 at 01:20 PM
Good day to sit back, watch, and learn. Those who are more worried about when American Idol is coming back on, or have been focused on getting folks in Tewksbury to help pay their high water bill for their green lawns, are going to get whacked upside the head in 2013 and 2014 as Socialism comes to America and we all begin the slide down the same road as Europe. California actually very close to bankruptcy already. Remember folks, people get the Government they deserve. https://www.newsmaxstore.com/newsletters/radar/obamacare_video.cfm?PROMO_CODE=1103A-1
AHM December 30, 2012 at 08:41 PM
Even making that real easy to understand I am still not sure we can through what the big problem is here. Or maybe it's just me not liking debt.
Nick January 02, 2013 at 12:20 AM
Happy New Year, North Reading residents have their own fiscal cliff, take a look at your property tax bill. More tax increases and no plans to reduce the cost government. We have fortune 500 companies in town that pay the same tax rate as residents, it doesn't make any sense. How can the town continue to fund public employee's pension and retirement. Why are we funding their pension at a time when the private sector has more or less done away with them.

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