Fiscal cliff averted but taxes rise for all
BATON ROUGE - Lawmakers reached a deal last night in Washington, averting the fiscal cliff, which included tax hikes for the middle class.
The deal did not include an extension of the payroll tax cut. Beginning January 1st, one tax went up for everyone. It's a two percent increase for workers' payroll tax contributions, which help pay for Social Security trust funds.
First enacted in 2010, the payroll tax holiday was meant to temporarily stimulate the economy.
"Those of us who are retired paid the full load for a long time, so it's time to get it back up," said Graham Thompson.
In two months, the national debt ceiling of $16.4 trillion will be reached and the county will reach its limit on borrowing.
"In order to raise the debt limit, i.e. allow the government to borrow more money, Congress has to give their approval," said Rep. Bill Cassidy. "Congress will demand changes that allow these important safety net programs to continue."
"Until we address the spending habits we have, I'm not in favor of raising the debt limit to address that problem," said Rep. Rodney Alexander. "We need to seriously address the spending habits so we can go on about lowering that debt crisis that we have."
The bill extends unemployment benefits for at least another year and revokes a $900 million pay hike for Congress. It also extends tax breaks for student loan interest.