Fiscal cliff forecast: Bad now, worse later

[Casino67]

Washington Times:

As Congress prepares to try to negotiate ways to avoid the fiscal cliff, its own scorekeeper has some stark analysis: There will be pain no matter what, but ducking choices now will mean an even worse situation by the end of the decade.

In two reports Thursday, the Congressional Budget Office laid out some of the options facing Washington as lawmakers return next week for a lame-duck session of Congress. But the CBO said that no matter what Congress does, the economy in the short term will struggle.

“Even if all of the fiscal tightening was eliminated, the economy would remain below its potential and the unemployment rate would remain higher than usual for some time,” the CBO said.

However, the nonpartisan agency went on to say that canceling the looming tax increases and spending cuts due in January would deepen deficits and leave the country less able to handle a major crisis in the future.

“If the fiscal tightening was removed, and the policies that are currently in effect were kept in place indefinitely, a continued surge in federal debt during the rest of this decade and beyond would raise the risk of a fiscal crisis … and would eventually reduce the nation’s output and income below what would occur,” the agency analysts said.

 

 

[Rokke]

The economy is going off a cliff. It has to. Imagine looking at a million dollar credit card bill and you only net $50,000 a year in income, and your boss is telling you to expect a pay cut. That's where America is right now. We can't tax our way out of it. That might even make it worse. Take a look at the steps Greece is currently taking. Take a look at where they were 5 years ago and 10 years ago. Greece, Ireland, Spain, France, USA. That is my projected order of collapse, and in every case, I'd say it is inevitable.