Fresh from re-election, Barack Obama extends a hand to the Republicans, but does not deny his program. In the first press conference since last June, the American President said he was willing to compromise with his opponents to avoid the “fiscal cliff”, but also essentially reiterated his fiscal strategy for the second term.
According to Obama, the legislation "can be simplified and made more efficient", but a revision and a possible reduction of tax deductions "would not be enough" to raise tax revenues by the necessary amount.
For this reason it is necessary "that the richest Americans pay more". Therefore, the tax cuts for citizens with incomes exceeding $250 originally allocated by the George W. Bush administration will not be extended.
Obama, however, added of not wanting to “close the door on anyone. I want to hear new ideas, the problem can be solved”.
The "fiscal cliff" (literally "fiscal precipice") consists of the combined effect of two measures which - without a new law intervention - will automatically take effect in January.
The deadly combination is a traditional recipe for austerity: tax increases (with the expiry of various tax bonuses) and spending cuts (welfare excluded). Recessionary effects are inevitable: GDP would drop by 0,5% next year and unemployment would return to over 9% (today it is 7,9%).
In political practice, the real problem is the rift that since January 2011 has paralyzed the action of Congress, divided between the Democratic Senate and the Republican Chamber. A stalemate confirmed by the latest consultations.
