WASHINGTON DC - Although the US averted the so-called “fiscal cliff,” a Cambodian economist in the US says the world still faces a number of economic challenges as Congressional leaders continue to wrestle with ongoing budget questions.
And the differing views on taxes and spending that are at the core of the debate between Democrats and Republicans will not be easily reconciled, Duch Darin, an economist based in Florida, told VOA Khmer in a Skype interview.
A last-minute budget agreement last week averted a round of automatic spending cuts and tax hikes, referred to as the fiscal cliff, but Congress still has not approved an overall budget, a process that could take another two months. The US stock market rebounded with the news of last week’s agreement, but Duch Darin said that kind of unsteady growth won’t last forever.
“The boost is probably for a short period of time, because the approved budget bill in the US is just part of the solution, and another part has not been solved,” he said.
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“For the Democratic Party, they want to raise taxes on the rich, while the Republican Party doesn’t want to,” he said. “On another point, on government expenses, the Democratic Party wants a government with more expenses to improve the US economy, while the Republicans want a smaller government with less spending.”
Duch Darin said the US economy is likely to improve over the first quarter of the year, as investors gain confidence over the decreasing ambiguity in the US budget.