The United States is in danger of falling over a fiscal cliff in January if the government fails to agree on a solution by the end of 2012.

 For De Anza students, the effects of the fiscal cliff will impact academic careers and personal lives. 

Without congressional action, up to $600 billion of expiring tax cuts, new taxes, and automatic spending cuts are set to take effect at the end of 2012 or beginning of 2013.

Ben Bernanke, the Chairman of the Federal Reserve, used the term “fiscal cliff” to describe this scenario because the numbers equate to a five percent reduction in gross domestic product.

Federal tax increases and spending cuts will affect all families regardless of income level.

 According to Jeremy Zremski in an article for Buffalo News, families of all income levels will pay anywhere from hundreds to thousands of dollars more in taxes if a payroll tax holiday is allowed to expire and payroll taxes increase.

“That increase would be the main reason why, come the new year, the IRS would start withholding more for taxes from virtually everyone’s paycheck,” Zremski wrote.

The cuts in federal spending will hit higher education too. 

According the American Association of Community Colleges, the fiscal cliff means “Across-the-board cuts to eight percent of domestic education programs on January 2, 2013.” 

The cuts to education will play out in many ways, according to an article by Smart Money writer Annamaria Andriotis. 

Pell Grant eligibility will be lowered, giving less people the chance to get financial aid and to attend college. 

The article says that interest rates on Stafford loans would go up, and the subsidized interest program could be eliminated completely.  

“Provisions for the American Opportunity Tax Credit, which allows families to get a tax credit of up to $2,500 per year for up to four years, are scheduled to expire at the end of the year,” Andriotis wrote, “Unless Congress acts, savings for taxpayers will be scaled back to a maximum of $1,900 per year for two years.“

No matter what one’s political preferences are, the looming fiscal cliff will affect everyone. 

De Anza students can get involved by writing a letter to U.S. Rep Mike Honda,  Sen. Diane Feinstein and Sen. Barbara Boxer before the end of December, to let the congressional members know that their constituents need action from their government.