Fiscal Cliff 'Cliffs Notes': How We Got to the Edge in 5 Easy Steps

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Fiscal Cliff

It seems like only yesterday that the fiscal cliff was a distant worry, a muffled rumble of thunder over the horizon. Yet as other stories have occupied the headlines, the cliff has drawn ever nearer. It has now been almost a year and a half since President Obama and Congress forged a pact to set the country on an autopilot course into economic Armageddon unless they were able to reach an agreement on the federal budget. Of course, that agreement never arrived, last-minute negotiations appear to be stalled and we are now staring down the barrel of a 12-gauge economic crisis.

With Jan. 1, 2013, less than three weeks away, we're looking back at the path we took to reach the crisis point with this quick refresher course.



For More on the Fiscal Cliff


Bruce Watson is a senior features writer for DailyFinance. You can reach him by e-mail at bruce.watson@teamaol.com, or follow him on Twitter at @bruce1971.

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gmydogbud

Those we send to Washington, DC, tell us that they are there to work for us, when all they do is turn their backs on their fellow Americans and take care of their big money friends. These people are bought and paid for before they ever take office. They and they alone have caused these fiscal problems! They need to have their retirement money and investment money take from them so that the American people can have all those I.O.U.'S - repayed and the President needs to return the over Seven Hundred Billion, he has taken from Medicare, to help fund his "Obama Care"! Neither the President nor the Congress are being forced to take his, sub-standard health care system - WHY? Don't they work for us? Why should our employees have better benefits than we, their employers?

December 16 2012 at 3:10 PM Report abuse +2 rate up rate down Reply
1 reply to gmydogbud's comment
digginya62

You're Right..."Campaign Reform" is the Ground Zero starting place...lol...in 1988-92 our congress
talked about this but my guess is the, "Big Lobbies for big business" sent truckloads of untracable
cash to capitol hill. Those who refused this cash were Run off!! Not only are these companies able
to get away with this, they are buying Both Sides in order to make sure their Agendas continue to
prosper. When Corporations & Government are joined at the "Hip" it makes for a strong case of,
"Fascism"....We are there now....they pay low taxes, are subsidized by Government, & get away
with polluting our air, water, & soil......We Must STOP this Activity before it's Too Late...
"gmydogbud" is right about this....it's out of control

December 16 2012 at 7:56 PM Report abuse rate up rate down Reply
Daarck Knight

R U tired and just worn out Nyc Financial from EVIL Man coMpensation aNd
INCOMING?
Then CALL
The Reverend and
B Happy Tyme with him on those anell tridents and BOUNCE HiGH and HigheR 4 and 4 that Extra Bounce use the Mustard
While Reverend plays hiZ spoons.

December 14 2012 at 1:24 PM Report abuse -2 rate up rate down Reply
Daarck Knight

climate change is NOT THE RIGHT WORD 2b used 4
EVIL MAN and his contribution 2 the climate change

that is

EVIL 2

MOTHER EARTH and the animals.

EVIL MAN STUPID MAN brings in sAtan in 20112, 201x, 201

The Mayans saw it and EDgar KC 2 - 1000% correcto

December 14 2012 at 1:09 PM Report abuse -3 rate up rate down Reply
Daarck Knight

Daarck Knight brands the nYc Penis with a swastika 2day just above the wEdDing band.
sAtan **** (he ejaculates) 4 hiz riNg.
This is what sAtan does and is used 2 doing. He has a lot of tyme on hiz hands U know.
bUT it IS U aNd EVIL MAN that brings Him out in 2011, 201x, 201.
Njoy hIz wHiTe cHrisTmaS
aNd
sIoNara

December 14 2012 at 1:04 PM Report abuse -2 rate up rate down Reply
Phil

Watson: What are your academic credentials? Please include them in your bio; otherwise, I have to assume that you have none, especially with regards to economics and finance. Thank you.

December 14 2012 at 11:54 AM Report abuse +1 rate up rate down Reply
1 reply to Phil's comment
t_trevor2

If you read any of Watson's gibberish, the extent of his economic credentials becomes apparent in the 1st paragraph.

Anybody who ever failed a home economics class knows more about economics than Watson.

Or as the old saying goes:

"The first rule of economics is that it is the study of human behavior as it relates to the allocation of scarce resources. And the first rule of politics is to ignore the first rule of economics"

Watson serves as a shining example!

December 14 2012 at 11:58 AM Report abuse +1 rate up rate down Reply
t_trevor2

Earlier this week, when releasing November federal budget figures, we received news from the US Treasury Department of how we got to the fiscal cliff:

"Overall tax revenue rose 10 percent in the first two months of the budget year to $346 billion. But spending has risen faster, up $87 billion or 16 percent."

What explains the type of stupidity that would preclude dumbest 1%ers like Watson from the comprehending the simple math inherent in the above?

December 14 2012 at 10:58 AM Report abuse +1 rate up rate down Reply
THOMAS AND JOYCE

"Discretionary Federal Programs" are the bane to our economic problems. For too long. Pork-Pork-Pork-and more Pork.

December 14 2012 at 10:47 AM Report abuse rate up rate down Reply
t_trevor2

The Bush tax cuts did not leave a big hole in government revenues.

In fact, just the opposite. In the 5 years following implementation of the tax cuts, federal revenue increased in each successive year, totaling a whopping 42% cumulative increase over the 5 year period.

December 14 2012 at 9:58 AM Report abuse -1 rate up rate down Reply
jhrooney

This whole deal was predicated on these cuts would be so bad, Congress would do a deal to get something done. Well, no deal.
By the way Mr. Watson, Huffington Post Operative, the national debt was 10.3t when Obama came into to office, and it is 16t and growing now. I don't see that you give any responsiblity to Obama for this. That is another way we got to the cliff, irresponsible reporting by you and others.
Why is it so hard for you to admit that a fellow brother screwed up? Do you have an 11th commmandment forbidding it? No only if the brother is a republican.

December 14 2012 at 9:53 AM Report abuse -1 rate up rate down Reply
FRANK

Instead of calling it a "fiscal cliff" why not just call it "responsible spending"..........

December 14 2012 at 9:29 AM Report abuse -2 rate up rate down Reply
2 replies to FRANK's comment
t_trevor2

Because it wouldn't actually entail responsible spending.

If nothing is done and we go over the "cliff", today's obscene levels of government spending will actually INCREASE. The so-called "cuts" are merely reductions from the oven more obscene baseline projections that would occur absent the "cliff".

In other words, to accurately refer to the level of spending as being "responsible" would entail REAL spending cuts, FAR more significant than anything envisioned by the faux cliff.

December 14 2012 at 11:18 AM Report abuse rate up rate down Reply
t_trevor2

Perhaps "slightly less irresponsible spending" would be accurate.

December 14 2012 at 11:20 AM Report abuse rate up rate down Reply