U.S. Tax Revenue To Take A Dive With This Election Result

After largely getting rejected by the US voters on midterm election, the U.S. President came out with the first compromise on Income Tax for middle class families.

In his after election defeat press conference, He said that he will work with the Republican controlled Congress to keep the tax increase at a minimum for middle class families. There is still the issue of Tax Increase of upper-income families.

The President was ready to let expire the Bush tax cut on Upper-income families

With the Congress now under the republican control, it will be next to impossible without some major compromise on other issues for the Democrat President to expire the Bush tax cut.

What it mean on the macro level for U.S. economy?

It is already being called scary. The current U.S. deficit is on a rising trend and is at US$200 trillion. If U.S. was a corporation, it would have been declared bankrupt.

Since the Tax increase is going to be rejected and blocked by the Congress, there is no way U.S. will be able to reduce the deficit to a more manageable level. Instead it will keep ballooning.

As soon as other countries will realize the dire situation the U.S. economy is in, they will refuse to do business with U.S.

Would you like to give credit to a Bankrupt company? Do the Banks give credit to a Bankrupt person?

How would you like to do business with a Bankrupt U.S.?

U.S. will bear the burden of this midterm election for a long long time.