So we basically parachuted off the cliff and landed to safety. However, we’re currently tangled in the parachute and patiently waiting for the instructors to get us out. How’s that for an analogy?

The biggest hurdle our elected leaders crossed is raising the tax rate for high income earners; $400,000 for individual earners and $450,000 for families of 2 or more. Capital gains were also increased for the same earners from 15% to 20%. The only place where more taxpayers are effected is in the payroll tax; There’s a 2% increase in the payroll tax contribution to Social Security for anyone earning over $50,000.

All combined, it’ll make a decent contribution to the revenue needed to contain and manage the national debt, but, it doesn’t speak to entitlement reform or the debt ceiling. Yes, we’re back to the debt ceiling again. We’ve survived the revenue battle, now we need to brace for the real debate – cutting spending.

Remember back in 2011, the discussion centered around raising the debt ceiling as a way to avoid having to raise taxes and effect entitlement reform. Now we’ve raised taxes and have no choice but to dive head first into entitlement reform… the re-visit of raising the debt ceiling again is likely a scare tactic. It’s nothing more than replacing the first bandage with a new one…

Let’s talk entitlement reform. Social Security, Medicare, Medicaid, Welfare, unemployment… These are programs on which most Americans count. If not one, then another; Maybe not all at one time, but, we all need an entitlement program at some point. This is where is it gets really sticky…

The difficulty is, we have no choice. It’s like college tuition being raised and the parents not being able to afford it. It’s not as if it’s not for a good cause or a useful purpose. But, without proper management and proper budgeting, the pot can go empty.

Congress and the President need to find a way to fine tune the administration of entitlements without significantly diminishing their benefits. This will be much more difficult than raising taxes. It’s like the debate over defense spending, which also factors into spending cuts.

With the war in Afghanistan drawing down, we should be able to see some relief there, but, like entitlements, there has to be a complete budget overhaul of defense. And like entitlements, no Americans want to see our troops without what they need to properly defend us where we need to be defended. But, we all agree, let’s providing endless aid and stop fighting in places where we don’t need to be and concentrate on defending our borders and protecting Americans around the world. We had to learn that the hard way with Benghazi…
So our next milestone in the debate over the economy is spending cuts. Stay tuned… this could take a while…