STOCK MARKET WATCH -- Monday, 24 September 2012

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17. ECONOMISTS SAY US NEEDS MORE TAXES, SPENDING CUTS

http://hosted.ap.org/dynamic/stories/U/US_NABE_SURVEY?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2012-09-24-07-28-47

NEW YORK (AP) -- The best way to reduce the federal deficit is through a combination of higher taxes and spending cuts, according to a group of economists.

The 236 members of the National Association for Business Economics recently surveyed say the country needs more fiscal stimulus through 2013, but by 2014 it should be time to throttle back. The reason for the delay: the sluggish nature of the country's economic recovery.

A majority of the economists favor extending payroll tax cuts, current marginal income tax rates and current tax rates for dividends and capital gains for most or all taxpayers through 2013. Deep tax cuts that were passed under President George W. Bush expire at the end of December unless Congress takes action. At the center of debate: extending the cuts for everybody. or just households earning less than $250,000 a year.

When it comes to making those cuts permanent, the group is more split. Nearly three quarters think the payroll tax cut should not be made permanent. The group is almost evenly split about whether to make the tax cuts on income, dividends and capital gains permanent.