CBO: Fiscal Cliff May Cause Recession | TigerDroppings.com

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Anodyne
LSU Fan
Member since Oct 2011
2162 posts

CBO: Fiscal Cliff May Cause Recession



quote:

NEW YORK (CNNMoney) -- Trillions of dollars in looming tax hikes and spending cuts set to take effect next year would likely cause a recession, the Congressional Budget Office said Tuesday.

At issue is the so-called fiscal cliff -- a series of measures set to begin in January that would take more than $500 billion out of the economy in 2013 alone.



quote:

Those measures include the expiration of the Bush tax cuts and protection of the middle class from the Alternative Minimum Tax, the onset of $1 trillion in blunt spending cuts, and a reduction in Medicare doctors' pay.

If Congress lets all those policies take effect, inflation-adjusted growth for 2013 would be just 0.5% -- with the economy projected to contract by 1.3% in the first half of the year and to grow by 2.3% in the second half.

"Given the pattern of past recessions as identified by the National Bureau of Economic Research, such a contraction in output in the first half of 2013 would probably be judged to be a recession," the CBO said.


quote:

Overall, taxable income would be lower, unemployment would be higher, tax revenue would fall, and spending on safety net provisions such as jobless benefits would increase, the CBO said.

Federal budget deficits, meanwhile, would be reduced by more than $500 billion.

By contrast, were lawmakers to cancel the onset of the fiscal cliff measures, the CBO estimates that growth in real GDP for calendar year 2013 would come in around 4.4%.


And the rest of the story...if we just keep printing money and overlooking our debt, we can avoid recession.

There are severe consequences to living on credit.







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Anodyne
LSU Fan
Member since Oct 2011
2162 posts

re: CBO: Fiscal Cliff May Cause Recession


quote:

For Congress, the outlines of the pending fiscal crisis are clear: Don’t do a thing, and watch the economy slip into a double-dip recession early next year. Or cancel the looming tax increases and spending cuts, watch the deficit rise, and push the government ever closer to a European-style debt crisis.

That decision was put in stark terms Tuesday by the Congressional Budget Office, which in a new analysis said the economy will plunge into a recession early next year if Congress lets taxes rise and spending be cut, as called for under the law.

But if Congress changes the law to keep taxes low and spending high, it could add more than half a trillion dollars to the deficit in 2013, marking a fifth straight year of trillion-dollar deficits and risking the patience of the country’s creditors.

The CBO numbers come just as the debate is heating up on Capitol Hill over how to handle the looming “fiscal cliff,” which Congress created by continually pushing off tough decisions on both taxes and spending.


LINK

quote:

Senate Majority Leader Harry Reid, Nevada Democrat, signaled Tuesday that he will allow the automatic spending cuts called for in last year’s debt deal to go into effect — culling billions of dollars from defense and domestic spending — unless Republicans agree to allow taxes to increase on at least some taxpayers.

“If Republicans want to walk away from the bipartisan spending cuts agreed to last August, they will have to work with Democrats to replace them with a balanced deficit-reduction package that asks millionaires to pay their fair share,” Mr. Reid said.

Republicans remain adamant that the lower income- and investment-tax rates passed in 2001 and 2003 under President Bush, and extended in 2010 under President Obama, must be extended again.

“No economy can sustain such a hit without being hurled into recession,” said Sen Orrin G. Hatch, the ranking Republican on the Senate Finance Committee, which oversees tax policy.


They just cannot stop playing politics.

Reid: Unless you allow us to tax "the rich" (wink-wink), more we are going to allow this country to act fiscally responsible and suffer the consequences that are necessary and ultimately inevitable.

Nevermind the fact that the revenues gained from the tax increase on the "rich" would not pay off the 2012 deficit if collected for 500 years. Literally.

Hatch: We cannot go into a recession at the potential beginning of a Republican presidency. Moreover, there is no way we can reduce defense spending...our military industrial complex friends would no longer be able to make copious amounts of money on useless conflict.



This post was edited on 5/23 at 9:16 am


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udtiger
LSU Fan
Louisiana
Member since Nov 2006
25592 posts

re: CBO: Fiscal Cliff May Cause Recession


frick Hatch. Guy's no better than Reid, except with Reid, I expect him to try to frick the country at every opportunity.





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BigBoyTiger
LSU Fan
Chicago
Member since Aug 2005
8751 posts

re: CBO: Fiscal Cliff May Cause Recession


quote:

frick Hatch. Guy's no better than Reid, except with Reid, I expect him to try to frick the country at every opportunity.


Agreed. I was sad he won the Republican primary. He should have been Lugar'ed.






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Anodyne
LSU Fan
Member since Oct 2011
2162 posts

re: CBO: Fiscal Cliff May Cause Recession


List of priorities for all of these MFers:

(1) Get reelected;
(2) Get reelected;
(3) Make tons of money under the table (also see #1 and 2 above)- special interest;
(4) Make sure my party affiliation looks credible among the sheeple, I mean people, that support it come hell or high water;
(5) Beltway cocktail parties;
(6) My mistress and my other mistress;
(7) My wife's rich family;


I honestly do not think that what is best for the country ever crosses the minds of the dicks.






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LSUgusto
Member since May 2005
16379 posts

re: CBO: Fiscal Cliff May Cause Recession


Yup! Absolute power... You know the rest.





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wickowick
LSU Fan
Head of Island
Member since Dec 2006
23767 posts

re: CBO: Fiscal Cliff May Cause Recession


quote:

(1) Get reelected;
(2) Get reelected;


IMHO, we need to go to a single 6 year term. Cut out reelection all together...






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LSUgusto
Member since May 2005
16379 posts

re: CBO: Fiscal Cliff May Cause Recession


While that sounds good, I'm afraid it would empower those who are unelected even more... The staffers, directors, insiders, etc.





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rpulli1
Iona Fan
the beach
Member since Jan 2011
694 posts

re: CBO: Fiscal Cliff May Cause Recession


quote:

And the rest of the story...if we just keep printing money and overlooking our debt, we can avoid recession.


The mantra of Kenysian economics.






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BrerTiger
Oregon State Fan
Hell & Ory-gone from da briar patch
Member since Sep 2011
10641 posts

re: CBO: Fiscal Cliff May Cause Recession


Erin Burnett had a good discussion about the CBO "fiscal cliff" warning last night.

I know, I know... nobody watches CNN.

LINK

She pointed out that both Harry Reid and Boehner are staking out their respective lines in the sand but gave Boehner credit for at least saying we need to act BEFORE the elections, not after.

She had on Douglas Holtz-Eakin, former CBO director, who said that it's pretty much unprecendented for the CBO to come out and warn about a recession if certain actions aren't taken. He called it "quite an extradorniary moment".

Burnett closed by saying that people like Tom Coburn (R-OK) and Mark Warner (D-VA) are our only hope at getting anything done before the election.

No wonder CNN's ratings are in the toilet. She actually tried to have a reasonable, rational discussion without yelling at or over her guests.






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Bard
LA-Monroe Fan
BR
Member since Oct 2008
16446 posts

re: CBO: Fiscal Cliff May Cause Recession


quote:

The mantra of Kenysian economics.


Because everyone knows the best way to get out of debt is to spend your way out of it






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DA
LSU Fan
Member since Sep 2007
16251 posts

re: CBO: Fiscal Cliff May Cause Recession


It doesn't matter. We're fricked regardless of what happens. We have one side of the system that has completely come off the rails.

The only hope is for the dems to take back the house, and keep the senate. If the Tea Naggers keep the House, I hope Romney wins. And then keep my fingers crossed.

It will be extremely challenging to solve our nation's problems, even with a united government. With the slop we have in government today, we don't have a chance. Remember, they want to default.

Glad I don't have young children.

Terrible things ahead.






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Bard
LA-Monroe Fan
BR
Member since Oct 2008
16446 posts

re: CBO: Fiscal Cliff May Cause Recession


quote:

The only hope is for the dems to take back the house, and keep the senate.


Right, because the Dems have been so much more fiscally responsible than the GOP was from 2000-2006... how many budgets did they pass when they controlled both chambers? How many once they also had the White House? How many have they passed while they have had the White House and Senate?




This post was edited on 5/23 at 12:42 pm


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BrerTiger
Oregon State Fan
Hell & Ory-gone from da briar patch
Member since Sep 2011
10641 posts

re: CBO: Fiscal Cliff May Cause Recession


quote:

Glad I don't have young children.


:inb4everyoneelseagreeswithyou:






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Bard
LA-Monroe Fan
BR
Member since Oct 2008
16446 posts

re: CBO: Fiscal Cliff May Cause Recession


quote:

BrerTiger

#ISWYDT






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BrerTiger
Oregon State Fan
Hell & Ory-gone from da briar patch
Member since Sep 2011
10641 posts

re: CBO: Fiscal Cliff May Cause Recession


quote:

It will be extremely challenging to solve our nation's problems, even with a united government. With the slop we have in government today, we don't have a chance. Remember, they want to default.


What do the Dems want?

To soak the rich and keep all the middle class tax cuts? More and more credits and giveaways in the tax code so that 30% of federal taxpayers pay income tax instead of the current 50% of taxpayers? Make the payroll tax cuts permanent? Never reform entitlement spending?

DA, just are the Dems so much more fiscally responsible in your mind?

How have Obama and the Dems (Pelosi and Reid) shown themselves to be capable of balancing budgets and moving the government into a long term sustainable financial position?

Unless you want to reelect Bill Clinton and the GOP congress of the 90s, I'm not sure where this hope you have comes from. Seems very faith based and not founded in anything resembling reality.



This post was edited on 5/23 at 12:56 pm


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DA
LSU Fan
Member since Sep 2007
16251 posts

re: CBO: Fiscal Cliff May Cause Recession


quote:

What do the Dems want?

To soak the rich and keep all the middle class tax cuts? More and more credits and giveaways in the tax code so that 30% of federal taxpayers pay income tax instead of the current 50% of taxpayers? Make the payroll tax permanent? Never reform entitlement spending?

DA, just are the Dems so much more fiscally responsible in your mind?

How have Obama and the Dems (Pelosi and Reid) shown themselves to be capable of balancing budgets and moving the government into a long term sustainable financial position?

Unless you want to reelect Bill Clinton and the GOP congress of the 90s, I'm not sure where this hope you have comes from. Seems very faith based and not founded in anything resembling reality.



We're beyond all that. Get the crisis garden seeds and load up on the ammo. We're heading over the event horizon.






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dewster
Maryland Fan
Member since Aug 2006
9104 posts

re: CBO: Fiscal Cliff May Cause Recession


quote:

Remember, they want to default

link?






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BrerTiger
Oregon State Fan
Hell & Ory-gone from da briar patch
Member since Sep 2011
10641 posts

re: CBO: Fiscal Cliff May Cause Recession


quote:

We're beyond all that. Get the crisis garden seeds and load up on the ammo. We're heading over the event horizon.




ETA: Never waste a good crisis, DA. NEVER.



This post was edited on 5/23 at 12:57 pm


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Taxing Authority
LSU Fan
Houston
Member since Feb 2010
22907 posts

re: CBO: Fiscal Cliff May Cause Recession


quote:

Glad I don't have young children.
Me too.







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