Ask Ash Cash: What The &$#@ Is A "Fiscal Cliff, Anyway?"
AllHipHop.com’s resident Daily Word guru and all-around inspirational guy, Ash Cash, is back with his latest installment of “Ask Ash Cash.”
Great Day, my Great People!! Welcome to another addition of Ask Ash Cash, where we go in the streets and answer all of your finance and business questions. Remember you can send your video questions to Questions@AskAshCash.com or via Twitter (@IamAshCash use #AskAshCash).
Q:Yo Ash Cash. Every since the end of the presidential election, all everyone on the news has been talking about is the economy and the "Fiscal Cliff".... Yo my dude... What the *!?&* is a Fiscal Cliff? -Tae Don (Harlem, NY)
A: Peace Tae! Thanks for the question. I've actually been asked this a lot because, just like "the great recession of 2008," the term “Fiscal Cliff” has gone from Wall Street to Main Street, leaving a lot of folks confused.
Without giving a long, drawn-out explanation, "Fiscal Cliff" is a term used to describe what will happen to the economy at the end of 2012, once certain laws change come midnight December 31.
To be more specific, once the New Year rolls in, we'll see an end to last year’s temporary payroll tax cuts, which will mean a 2% tax increase for workers, the end of certain tax breaks for some
businesses, the end of tax cuts from 2001-2003, and the beginning of some tax increases due to the President’s health care law.
Also, many of the spending cuts that were agreed on as part of the debt ceiling deal of 2011 will begin to go into effect. It's estimated that over 1,000 government programs will face some deep, automatic cuts.
The government has three options they can choose when trying to deal with the fiscal cliff, but in my opinion, they all lead to a continual decline in our economy. The real question is whether we want to feel it now or feel it later... Do we take a painkiller, or do surgery now?
For a more detailed explanation, please turn to CNN, CNBC, MSNBC, or any other business news network. It's the buzz phrase of the day!
Ash'Cash is a business consultant, motivation speaker, personal finance expert, and author of Mind Right, Money Right: 10 Laws of Financial Freedom. For more info, please visit www.IamAshCash.com.