News Summary: Higher rates or fewer tax breaks?

FISCAL CLIFF WARS: Democrats are demanding to raise revenue by boosting tax rates on the nation's highest earners. Republicans insist on eliminating deductions and other tax breaks instead. Which is better for the economy?

ON THE ONE HAND: Economists generally agree that a simpler tax code with lower rates and fewer deductions, exemptions and credits would help the economy. With fewer tax preferences, people would be more likely seek the best investments for their money instead of the most lucrative tax breaks. And lower rates would leave them more money to spend.

ON THE OTHER HAND: Whether the higher tax rates that President Barack Obama wants would hurt the economy more than curbing deductions, as Republicans assert, and the picture is less clear. Many economists say it would depend on which deductions lawmakers curb.