The term "fiscal cliff" which is facing the country at the end of this year refers to a combination of tax increases and spending cuts due to take effect in January 2013 after certain current legislation expires. This is a result of the expiration of the Bush-era tax cuts, the end of unemployment insurance, and expiration of the payroll tax holiday. Also dividends, currently taxed at 15% would rise to 20%, as would the long-term capital gains rate. Additionally, a process called "sequestration," an "automatic" form of spending cuts, which happens when budget targets are not met, may go into effect. Sequestration would result an 8% cut in non-discretionary and defense programs.
These events could lead to a recession, something neither party wants to happen.
If the parties cannot come to agreement on tax increases and spending cuts, the result would be devastating for programs and services that effect people with disabilities, such as Individuals with Disabilities Education Act (i.e., education, preschool and Infant and Toddler), employment, transportation, and housing to name a few. Medicare, Medicaid and Social Security (known as entitlement programs) would be exempt from sequestration.
If the parties negotiate and ultimately come to agreement, thus avoiding sequestration, entitlement programs can be cut as part of the negotiations. Medicaid, which provides long-term support services that enable adults with disabilities to live and work in the community and Medicare which also funds services for many adults with disabilities could both see big reductions.
We are mindful of the fiscal crisis facing our country. However, the quality of lives of people with Down syndrome and other disabilities depends upon access to adequate funding AND quality services. We are working with lawmakers to ensure that individuals with disabilities have the support they need to get a quality education and live and work in their communities. Hopefully our children can look forward to a future in which they can become taxpaying citizens.
We will keep readers posted throughout this process as issues arise that call for timely advocacy.