Years ago the “Dummies” book titles began showing up on shelves worldwide.  These books are intended to take a complicated matter and make it understandable for anyone with an interest in a given subject matter. (I.e. “Pinterest for Dummies”, “Fitness for Dummies”…).  Today’s blog is inspired by my own lack of understanding the so-called ‘’Fiscal Cliff”. So I have done some research and will now attempt to sum up the ‘’Fiscal Cliff”.

On January 1st, the Budget Control Act of 2011 (which was voted into place by the federal government) was scheduled to go into effect.  It meant we would have been hit with substantial tax increases and not just the wealthy.  In addition, we would have a debt ceiling that we can no longer exceed as a country which (according to Barron’s) would have led to immediate deep automatic cuts in over 1,000 government programs, including the defense budget and Medicare.  Here were the three main choices our law-makers were faced with:

• They could have let the current policy scheduled for the beginning of 2013 – which features a number of tax increases and spending cuts that are expected to weigh heavily on growth and possibly drive the economy back into a recession – go into effect. The plus side: the deficit, as a percentage of GDP, would be cut in half.
• They could have cancelled some or all of the scheduled tax increases and spending cuts, which would add to the deficit and increase the odds that the United States could face a crisis similar to that which is occurring in Europe. The flip side of this, of course, is that the United States’ debt will continue to grow.
• They opted to take a middle course, which appears to be an approach that will address the budget issues to a limited extent and will have a more modest impact on growth.

The bill that was passed last night will eliminate the tax increases for families making under $450,000, while letting rates rise for those making above that threshold. It would also extend unemployment insurance for another year, while patching up a host of other expiring provisions and delaying automatic spending cuts for two months. Those cuts, which would hit defense heavily, will instead be offset with a blend of tax increases and other spending cuts.  However, we will still see a 2-point increase this month in Social Security taxes, as Congress did not opt to extend the payroll tax holiday.

In their search for the answer, I hope Congress considered what the Bible has to say about finances.  There is no lack of scripture on this subject matter.  In fact, the Bible speaks about money more than the word “salvation” which should be a pretty strong indicator that keeping our priorities straight can be a bit of a problem.  Congress may be struggling with our nation’s budgetary issues but allow me to humbly leave you with this scripture for your own finances:

“The rich rules over the poor, and the borrower become the lender’s slave.” (Proverbs 22:7)

http://www.foxnews.com/politics/2013/01/01/house-approves-fiscal-crisis-bill/