Unemployment in June rose to 9.2 percent, with employers adding just 18,000 jobs, raising concerns that the second half of 2011 won’t lead to an expected economic revival. Forecasters predicted that the rate would remain unchanged at 9.1 percent. In spite of poor numbers, analysts still believe that the economy will rebound in the remaining months of the year, suggesting that June’s numbers was simple a “soft patch” on the road to recovery.
As a result of these numbers, Republicans renewed their position on tax ceiling discussions that Washington can’t afford to increase taxes on Americans. House Speaker John Boehner stated, “Tax hikes on families and job creators will only make things worse.” Democrats and Republicans are deadlocked in an agreement to raise the debt ceiling by August 2nd. They must account for $4 trillion over the next ten years; Republicans are pushing for further cuts while Democrats wants the necessary funds to come from increased taxes.
Republicans pushed for a debt and deficit reduction plan as part of their agreement to increase the debt ceiling – the amount of money Congress can borrow. As of now, the two sides are not close to an agreement, according to Boehner, as they disagree on how to close the $4 trillion gap. Democrats are calling for raising tax revenues but doing so in a way to avoid additional taxes on the middle class such as closing tax loopholes for certain luxury industries raising taxes on the highest-earning Americans.
So far, Republicans have been unwilling to budge on their requirements that the revenue not come from additional taxes. Instead, they’re urging for changes to government programs such as Social Security and Medicare. Yesterday, President Obama suggested such measures.
Congress will remain in session to discuss the problem over the weekend.