What Even Is A Fiscal Cliff?

This week in class as we were discussing the election and various issues voters were taking into consideration, Mr. O’Connor brought up the topic of the “Fiscal Cliff.” Although I have heard many people discussing this topic, ranging from people in some of my other classes to shows on TV, I was still unsure of what exactly everyone meant by “Fiscal Cliff. ” A Q&A article on the New York Times website by Jonathon Weisman really explained to me well what the Fiscal Cliff actually was. What I understood from the article was that in 2001 and 2003, large tax cuts were passed. However, in the beginning of 2013, these tax cuts are going to expire and have a “drastic and sudden hit to the economy” or in other words, a fiscal cliff.

            Both the democratic and republican parties agree that if nothing is done to extend the tax cuts- it could send the US economy back into a recession. What they can’t agree on though, is how to make sure another recession does not happen. The republican party does not want to raise the debt ceiling but President Obama will not sign onto anything giving families with an income of $250,000 or more a tax cut. Going on campaign promises, he is all about the tax cuts for the middle class.

            What Mr. O’Connor also brought up was just thinking about the name, “Fiscal Cliff” and how it sounds. The repetition of sounds in the two words is interesting and may be a reason as to why it is such a popular phrase.

            I think that the debt ceiling will be raised in order to avoid a second recession. But what do you think? How will the two parties solve this issue? And if we don’t even come to an agreement, will a recession definitely ensue?