Mississippi Senator Issuing Warnings About The ‘Fiscal Cliff’By Jeffrey Hess | Published 14 Dec 2012 05:01pm |
Mississippi's junior senator is warning that failure to reach a budget deal in Washington D-C could have deep impacts in Mississippi. MPB's Jeffrey Hess reports a set of automatic tax hikes and spending cuts called the 'fiscal cliff' could slow or reverse the state's sluggish economic growth.
Because of a heavy reliance on federal spending, Mississippi is especially vulnerable to the fiscal cliff.
Senator Roger Wicker says cuts to defense spending could hurt Mississippi because the state has strong manufacturing ties to the defense industry....including building ships, radar components and aviation manufacturing.
"And that threatens more than 11-thousand Mississippi jobs as well as a million jobs nationwide. So it is something that we very much need to avoid and it’s something that, frankly, I see as being much more likely every day that passes," Wicker said.
Wicker says he is willing to work with the president to raise federal tax revenues but has concerns that the tax hikes set to take effect next month would harm Mississippi families and small businesses.
Mississippi's economy is barely growing, around a percent a year, and is not expected to get back to pre-recession employment figures for several more years.
Senior State economist Marianne Hill recently told M-P-B news that deep or sudden spending cuts could knock the state back into recession.
"As the debt crisis nationally continues, we expect to see further contraction of federal funds come into the state which is especially critical here. The value of our output is about 100-billion and the value of federal funds is about 30-billion. So we are highly dependent on federal funds for maintaining employment in this state," Hill said.
Senator Wicker says if a deal is struck this week, congress may have to work until Christmas to get it passed and avoid the fiscal cliff.
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