Taxes

The House, Senate and President all recently agreed to last-minute legislation to stop automatic tax increases and delay arbitrary defense spending cuts known collectively as the “fiscal cliff.” The President had consistently said the fiscal cliff must be resolved through a “balanced approach” to deficit reduction including new tax revenues as well as spending cuts.

All eyes are now focused on negotiations to resolve the fiscal cliff, which if left unaddressed will result in arbitrary spending cuts and tax rate increases for all earners at the beginning of next year. Arbitrary cuts combined with new increases in tax rates would undermine economic growth and likely send our economy back into recession.

As Congress turns its focus to resolving the fiscal cliff - the end-of-the-year deadline after which deep cuts in spending and increases in tax rates for all earners take effect - there is much disagreement on how to bring down the deficit in a responsible way without harming our economy. The question of tax rates remains one of the largest sticking points to the debate.

When Congress returns to Washington after the election, we have a long list of items to address before the end of the year. One of the biggest priorities, especially for Nebraska producers, will be passing a responsible Farm Bill to prevent a lapse in policy. Congress also must act to prevent the largest tax hike in American history before the current rates expire on January 1, 2013.

The national economy is bleak. Four years after a deep recession, unemployment remains stubbornly high at 7.8 percent, and economic growth has slowed to 1.3 percent. Families and small businesses are struggling to make ends meet. As wages and benefits have been cut, prices of electricity, gas, food, and health care continue to rise. Clearly, we are not headed in the right direction.