The US will survive. Will we?

For the last month the entire world has been agog about the looming " fiscal cliff " in the US. The impasse came about because President Obama wanted to raise taxes on everyone earning more than $250,000 per year while the Republicans were implacably opposed to any tax rise on anybody. Around 95% of Congress Republicans had signed a " Taxpayer Protection Pledge " proposed by extreme right wing guru, Grover Norquist, founder and President of Americans for Tax Reform. Why grown up people would sign such an infantile pledge which ties their hands as lawmakers we do not know. If no deal was reached by the new year taxes would rise on everyone and $600 billion worth of cuts would immediately come into effect affecting social security, medicare and defense spending. The fear was that if such massive cuts came in the US would go into recession affecting the whole world. Hence the feverish interest. However, a deal was finally brokered between Vice President Joe Biden and Senate Minority leader, Mitch McConnell which was passed by the Senate and sent to the House where it passed with Democrat support. Under the deal income tax will increase from 35% to 39.6% on every single person earning more than $400,000 and on families earning more than $450,000. Taxes on Dividend and Capital Gains above those levels will rise from 15 to 20% and Estate Tax, or Death Duty as it is known in India, will rise to 40% on anything above $5 million which will rise with inflation. Pay roll tax goes up from 4.2 to 6.2% affecting low paid workers. Cuts is unemployment benefits have been postponed by one year and $109 billion worth of cuts in spending will come into effect after 2 months. The US government has already run out of cash to pay salaries and interest on its loans so the debt ceiling has to be raised in the next 2 months or else the US will default on its debts and may face a credit downgrade.The Republicans are already promising that they will not raise the debt ceiling unless Obama proposes cuts to spending, especially to entitlements or Social Security spending. The Democrats are reluctant to reduce entitlements because it hurts the poor. The Republicans have a majority in the House which is in charge of the budget and all spending so another bitter fight is to be expected. Everyone, especially Americans, blames the Congress for being ideological fanatics and so uncivil that they are unable to come to a bipartisan agreement for the sake of the country. But the Americans have a real choice on who they vote for. They know the positions of their lawmakers that they send to Congress so are sure that politicians will do what the people want. Not so in India. Here all the scoundrels are interested in is to win the election because that will give them the opportunity to loot. Thus there is a competition in throwing handouts on taxpayer money. The US will survive but will India?