Tax Deficit Essay

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Taxes are always a highly debated topic when it comes to economics. The reason for that is because taxes play a major role in it and also in everyone’s lives. Most of government spending is paid with taxes, and a large portion comes from income tax and social security taxes (Bouman). These taxes affect everyday people the most, which is why taxes are so heavily debated and discussed. This paper will discuss which taxes should be raised, who will get the raises and opposing opinions or alternatives to raising taxes.

A major issue that is discussed is the deficit of the federal government. This is something that has been going on for a few years, but has dropped some in 2015. However, this deficit and the others in previous years
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Cutting government spending does seem like the easy and obvious answer to fix the problem and maybe should happen in certain aspects but if you actually look at the whole picture it would seem unwise to make a big cut on government spending. The reason for this is that these government agencies are relying on the money that is coming in. If we were to cut these then the businesses would not function as efficiently and may not be able to perform everything that they did. (Vinik) For example, let’s say that there was a cut on government spending and the post office took a big hit and had to fire some delivery drivers. It would then take longer to get mail because there are less drivers and then could possibly result in an increase in postal charges. I think that the bad outweighs the good in this situation.

There are also a couple of arguments that could be made against the rise in corporation taxes. One is that there are already companies that are threatening to leave the United States so a rise in taxes could push them all the way over and cause them to leave. (Sahadi) This could potentially be a big problem and is definitely a valid argument. Another argument could be that an increase in taxes could cause the corporations to raise their prices which then could cause a decrease in spending. While this is possible and a good argument, I am not sure that it would cause enough
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The first example is rather than raise the tax, why not raise the age of retirement. This is definitely a valid point and could help fix the issue of social security, but happen if people continue and continue to live longer; we could be in the same boat in the future. Another argument is that increase would be that we longer need social security because people have 401k and can invest their own money for retirement. While this is also a good argument, you could say that it is a little risky to do this. There are also many people who do not know enough about stocks and investing.

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