Solid evidence that this is happening is spotty. Two surveys offer contrary prognosis -
None of that means that the economy is sure to take a dive at the close of the year.
Those with more optimistic forecasts for consumer spending in the final months of 2012 pointed to high consumer confidence indexes in September and October, which suggested that Americans were bullish enough on the future that they might keep spending despite the stagnation in their incomes.
Of course, all such surveys aren’t the same as the economy, and should be treated with a measure of skepticism.
One thing is also clear: any impact of the so-called cliff will not be immediate rather a slow and lingering economic decline.
I offer you a guide from The Atlantic Wire:
Panicker: “Cliff chaos: Hundreds of billions apart,” Politico’s Jake Sherman and John Bresnahan report.
Facts Reported: The White House offered a plan with $1.4 trillion in new revenue, down from its $1.6 trillion initial offer. Republicans are still offering $800 billion in new revenue.
Panic Analysis: “The two sides are still hundreds of billions of dollars apart on revenue and entitlement cuts… That’s why there’s increasing skepticism in Washington that a deal actually can be reached before Jan. 1… The reality is the two sides are swapping proposals that do little but reaffirm the positions they’ve long held.”
Panicker: ”Obama, Boehner trade ‘fiscal cliff’ proposals but appear no closer to a deal,” The Washington Post‘s Lori Montgomery and Paul Kane report.
Facts Reported: After Boehner and Obama’s meeting Sunday, “senior GOP aides said they were left with the impression that the president was willing to reduce his demand for $1.6 trillion in new taxes over the next decade to $1.2 trillion,” but he offered $1.4 trillion instead. “A person close to the talks said the White House also offered to undertake an overhaul of the corporate tax code.” No one would say what was in the GOP’s latest counteroffer, “but Republican sources close to the talks said the offer made no concessions on the central issue of higher tax rates for the wealthy.”
Panic Analysis: “President Obama and House Speaker John A. Boehner were struggling late Tuesday to prevent negotiations from breaking down after they traded dueling proposals for averting the year-end “fiscal cliff” that made no progress toward an agreement.”
Panicker: “As Fiscal Talks Heat Up, Questions on Whether Boehner Can Get the Votes,” The New York Times‘ Jackie Calmes and Jonathan Weisman report.
Facts Reported: Boehner and Obama had their first one-on-one meeting since July 2011. Obama offered $1.4 trillion in new revenues. one person familiar with the White House proposal said Mr. Obama had reduced his call for $1.6 trillion in additional revenues from the wealthy over the first 10 years to $1.4 trillion, still $600 billion higher than the Republicans’ position. And another said the president also proposed that the two sides commit to working on overhauling the corporate tax code next year.
Panic Analysis: “The direct discussions followed a week in which preliminary negotiations among top-level staff advisers had not gone well, according to people in both parties, with time running out before a year-end deadline for action. The president has no choice but to rely on Mr. Boehner, who leads Republicans’ only center of power… But Democrats in the White House and Congress also say that they believe Mr. Boehner does hold greater sway among Republican colleagues than he did in the summer of 2011…”
So what is your panic level?
- TheAtlanticWire.com: The Sliding Scale of Fiscal Cliff Panic (theatlanticwire.com)
- Boehner: ‘Serious differences’ separate GOP from Obama (firstread.nbcnews.com)
- Inching closer to “fiscal cliff” deal? (cbsnews.com)
- Cliff chaos: Hundreds of billions apart (politico.com)
- Obama, Boehner battle over ‘fiscal cliff’ (usatoday.com)