Explain Fiscal Cliff to me

[mikegg]

I'm reading the fiscal cliff Wikipedia page where it states 2 likely scenarios:

1. We run a deficit of ~$600 billion in 2013
2. We run a deficit of ~$1 trillian in 2013

Can someone please explain to me how reducing the deficit by $400 billion in 2013 is going to help our economy in the long run? It's just going to take 8 years for our deficit to reach our GDP level instead of 4.

Are we just doomed anyways?

Why can't we just create a surplus and actually start decreasing our principal? Yea, we'll take a hit economically and our standard of living is going to go down a little but at least we might be able to avoid a situation like Greece.

 

[EXman]

I'm reading the fiscal cliff Wikipedia page where it states 2 likely scenarios:

1. We run a deficit of ~$600 billion in 2013
2. We run a deficit of ~$1 trillian in 2013

Can someone please explain to me how reducing the deficit by $400 billion in 2013 is going to help our economy in the long run? It's just going to take 8 years for our deficit to reach our GDP level instead of 4.

Are we just doomed anyways?

Why can't we just create a surplus and actually start decreasing our principal? Yea, we'll take a hit economically and our standard of living is going to go down a little but at least we might be able to avoid a situation like Greece.

We're doomed people want something for nothing and the greedy people who pay almost all the taxes need to have some skin in the game. It's 100% a revenue problem!

 

[Doppel]

Why can't we just create a surplus and actually start decreasing our principal? Yea, we'll take a hit economically and our standard of living is going to go down a little but at least we might be able to avoid a situation like Greece.

People want to put problems off as long as possible.

 

[Ausm]

I'm reading the fiscal cliff Wikipedia page where it states 2 likely scenarios:

1. We run a deficit of ~$600 billion in 2013
2. We run a deficit of ~$1 trillian in 2013

Can someone please explain to me how reducing the deficit by $400 billion in 2013 is going to help our economy in the long run? It's just going to take 8 years for our deficit to reach our GDP level instead of 4.

Are we just doomed anyways?

Why can't we just create a surplus and actually start decreasing our principal? Yea, we'll take a hit economically and our standard of living is going to go down a little but at least we might be able to avoid a situation like Greece.

We would never get into this situation because we have money printers!

 

[3chordcharlie]

As far as I can tell, it will be better if the fiscal cliff happens than if it is 'avoided'.

People are resilient in general, the economy will recover, and the bitter pill will finally be moving the fiscal needle in the right direction for the first time this millennium.

 

[K1052]

As far as I can tell, it will be better if the fiscal cliff happens than if it is 'avoided'.

People are resilient in general, the economy will recover, and the bitter pill will finally be moving the fiscal needle in the right direction for the first time this millennium.

The thought is that it will tip a slow recovery back into recession, setting us back more. This is a major concern at least in the private sector where companies have clamped down on a lot of spending until Congress resolves the issue. For all of the anti-Obama talk Congress has been by far the largest source of uncertainty to the business world...especially after the near disastrous flirtation with not raising the debt ceiling.

 

[NoStateofMind]

As far as I can tell, it will be better if the fiscal cliff happens than if it is 'avoided'.

People are resilient in general, the economy will recover, and the bitter pill will finally be moving the fiscal needle in the right direction for the first time this millennium.

That's just it. If it can be avoided by us tightening our belts then I'm all for it. Raise taxes a bit and reduce spending to get us out of this mess. But we won't because partisan politics will get in the way of whats right.

 

[PokerGuy]

Are we just doomed anyways?

Yup. We're shuffling chairs on the titanic and arguing about who gets to sit where instead of actually doing anything to fix the problem.

I'm sure some 'compromise' will be reached where the can will be kicked down the road as usual putting us in an even worse long term position.

We're doomed because we keep electing idiots on both sides of the isle who have no intention of addressing the real issues.

 

[Incorruptible]

Yup. We're shuffling chairs on the titanic and arguing about who gets to sit where instead of actually doing anything to fix the problem.

I'm sure some 'compromise' will be reached where the can will be kicked down the road as usual putting us in an even worse long term position.

We're doomed because we keep electing idiots on both sides of the isle who have no intention of addressing the real issues.

This is the problem that we have but tell that to all the partisan idiots

 

[mizzou]

we just need one good roll up your sleeves and work the debt off kind of year, and then we can go back to spending just a little bit more then we need to

 

[Pr0d1gy]

lol @ this thread. Geez.

 

[piasabird]

At this point I think we should just let all the Bush Tax Cuts Expire. I want people to suffer as much as possible so they will get the point.

 

[Doppel]

Oh, and easy prediction: the "cliff" will be avoided. Worst case it briefly kicks in and is backed out for most people. All of this current buzz is just political nonsense. I can't imagine really any politicians in Washington expect the bush tax cuts to expire and taxes on virtually everybody rise, it's crazy.

 

[HumblePie]

Fiscal cliff is easy to explain.

Obama and a few other put forth a signed law stating that either a balanced budget proposal with spending cuts will be completed or X amount of dollars from various programs will automatically be cut regardless if no plan is reached. It's a broad sweeping ultimatum cut that is set to happen as it has already passed.

The other part of the cliff is the Bush Tax cuts to ALL tax brackets are set to expire as well at about the same time.

So the two parts of the fiscal cliff are massive spending cuts and sizeable tax hike all are set to happen if law makers do not agree to a different plan before it does happen.

Many argue that such measures if they happen as they are set are too drastic and will screw the economy hugely. That there needs to be more breaking in with both tax increased and budget spending cuts than the current broad sweeping measures currently looming.

 

[Todd33]

At this point I think we should just let all the Bush Tax Cuts Expire. I want people to suffer as much as possible so they will get the point.

I agree the only way they passed in the first place was due to their expiration. If they want to pass something new after let them try.

 

[wuliheron]

The republicans had been steadily losing ground since Ronald Reagan on every issue and when Bush screwed the pooch and dumped us into the worst recession since the great depression they knew the jig was up. The result was the rise of the Tea Party and first election of Obama which represented the American public demanding a revolution to throw the bums out. The fiscal cliff was a crisis invented by the Tea Party to avoid dealing with the budget in an effort to discredit Obama and retain control, but his reelection was all the evidence the public needed to prove this is a real revolution and it's time to throw the bums out.

There is no way the Tea Party is going to risk crashing the entire economy. Their bluff has been called and once we're past this last ace in the hole they tried to play the real work begins to throw the bums out and get on with business. No more of this ignorant hillbilly crap about legitimate rape and half the country being lazy bums. Either they learn how to get along with people, accept they lost, and that people demand real change or it's time to face the music.

 

[werepossum]

The republicans had been steadily losing ground since Ronald Reagan on every issue and when Bush screwed the pooch and dumped us into the worst recession since the great depression they knew the jig was up. The result was the rise of the Tea Party and first election of Obama which represented the American public demanding a revolution to throw the bums out. The fiscal cliff was a crisis invented by the Tea Party to avoid dealing with the budget in an effort to discredit Obama and retain control, but his reelection was all the evidence the public needed to prove this is a real revolution and it's time to throw the bums out.

There is no way the Tea Party is going to risk crashing the entire economy. Their bluff has been called and once we're past this last ace in the hole they tried to play the real work begins to throw the bums out and get on with business. No more of this ignorant hillbilly crap about legitimate rape and half the country being lazy bums. Either they learn how to get along with people, accept they lost, and that people demand real change or it's time to face the music.

Must be hell trying to walk through doorways with that extreme leftward lean.

 

[fskimospy]

I'm unaware of a single credible economic authority that thinks suddenly balancing our budget is a good idea. Has no one learned the lesson from Europe about the utter failure of austerity in a depressed economy? I don't want us to be Greece either, but what I mean from that is that I don't want us to enact irresponsible and foolish austerity measures.