Over the past month, most Americans have been keeping a sharp eye on the news in all its forms to watch for the drop off the Fiscal Cliff that the government mentioned was coming.
It seems that the government is in its last ditch efforts to avoid this from happening by raising what is called "the Debt Ceiling". In essence, the debt ceiling is a limit on the debt that the American government has accumulated over the years.
Yet, America is currently raising to meet the Debt Ceiling in an alarming speed.
Knowing this could cause serious problems with the all ready fragile economy, President Obama has stepped in to try and avoid such a crisis.
In an http://www.cbsnews.com article, "Obama calls on Congress to avert sequester", Obama has urged Congress to come up with any solution that will prevent hitting the Debt Ceiling.
Obama was stated as saying:
'Economists and business leaders from across the spectrum have said that our economy is poised for progress in 2013 and we've seen signs of this progress over the last several weeks. But we've also seen the effects that political dysfunction can have on our economic progress... The threat of massive, automatic cuts has already started to affect business decisions. So we've been reminded that while it's critical for us to cut wasteful spending, we can't just cut our way to prosperity.'
What cuts are being mentioned? At the current time, there isn't a deal on the table that is being agreed upon. The previous plan Obama's administration had laid out last year is apparently still on the table for Republicans to look over and come to an agreement on.
When this proposal was originally offered as a solution to the Fiscal Cliff, Republicans wanted no part of it saying it was too heavily weighted on the top earners in America. Now, a few Republicans have offered to look over Obama's proposal.
Why now? What has changed?
A week ago, the Legislative Notice H.R. 325 was passed by the House. This bill is called the "No Budget, No Pay Act of 2013".
The article about this bill was released on http://www.rpc.senate.gov. In short, this bill was a measure set up by President Obama to temporarily raise the debt ceiling until May 19, 2013. This means that everyone on disability or Social Security will still be paid until that time.
What will be done in the during this time?
During this "grace period", the President told the Congress to come up with a Budget Resolution but the bill stipulates one condition:
'This section requires that each chamber agree to their own budget resolution for fiscal year 2014 by April 15, 2013, or else compensation for Members will be deposited into an escrow account and will not be paid to Members until (1) the day when the chamber in question passes a budget resolution, or (2) the last day of the 113th Congress.'
This meaning that in any time from April 15, 2013 on till the end of the 113th Congress, which will end in two years, the chambers will not be paid until they agree to a budget resolution.
With the belts being tightened on the chambers, the time for coming up with a solution has arrived and many of both sides are seeing it is time to carefully look at both sides of the equation.
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