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January 7, 2013

Officials react to ‘fiscal cliff’

Monday, January 7, 2013 — Congress may have averted a fiscal cliff, but there is still a need for parachutes as the first session of the 113th Congress is gaveled into session.

The 112th Congress had set itself a deadline for the end of 2012 to formulate solutions to taxing and spending problems within the federal budget.

That deadline included an automatic income tax increase on everyone and more than $1 trillion in defense and domestic cuts.

It took 17 months, and missing the deadline by one day, but Congress took actions that permanently installed what are called the “Bush tax rates” which means individuals making less than $400,000 will see no increase in federal income taxes.

But everyone with a paycheck will see a slight bit more withheld in payroll taxes as the “tax holiday” was not part of the extentions. Those rates will increase from 4.2 to 6.2 percent in the new year.

Both of the state’s United States senators, Kay Hagan and Richard Burr, voted for passage of the last-minute agreement.

Hagan, a Democrat, was looking ahead at Congress’ next battles when she hosted a conference call with members of the press.

“There are some very serious issues and (Congress) has got to come together for the good of our country,” she said.

Hagan said the decision to raise taxes on those making more than $400,000 is only a step in getting the deficit reduced, but one she backed.

“We cannot default on our obligations. This is not a fair future for (our children) to grow into if we don’t have the ability to solve these problems,” she said.

North Carolina’s House members split in support of the deal, with six voting for passage and six voting against. Former 8th District Rep. Larry Kissell was one of those who voted in the affirmative.

With the new Congress that includes more than 90 new members, the talk of the fiscal cliff continues even in the wake of a deal that was struck between the Democratic-majority Senate and the Republican controlled House.

With the deal, the legislation would raise nearly $600 billion in revenues over the next 10 years, according to various estimates.

The new members of the 113th Congress began their new duties on Thursday, but freshman Congressman for the 8th District Richard Hudson expressed his dissatisfaction with the deal through a press release a day before taking his oath.

“I am deeply disappointed in the measure that passed the House last night. I was hopeful that Congress could find a true solution to get our fiscal house in order, but instead, they continue to kick the can down the road,” Hudson began his release by saying.

Further in the release, Hudson pointed to the deal’s tax hike as the main point of conflict, which he said was the largest in 20 years.

“The fiscal cliff of 2012 is nothing compared to the damage we are doing to future generations of Americans who will be crushed by debt,” he said.

“When I assume office, I plan to begin to advance a balanced budget amendment and collaborate with my colleagues on proposals that will put America on a path to economic prosperity through spending restraint.”

Although Hudson was not a part of voting against the deal, he will get a chance to be a part of a Congress with much on its plate.

Within 60 days as given in their deal, Congress will face another decision on how and where to cut spending in defense and on if it will raise the debt ceiling.

 

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Albemarle firefighters battle a house blaze at 623 Summit Ave., Monday. The fire began in the kitchen area.

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