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United States Fiscal Cliff

Budget office: 'Fiscal cliff' cuts, tax hikes would lead to recession

Austere "fiscal cliff" tax increases and federal spending cuts set for the end of the year would send the economy back into recession and cause a spike in the jobless rate to 9.1 percent by next fall, congressional budget analysts said Thursday. The tax and spending changes, which a lame-duck session of Congress will dig into next week, would cut the federal deficit by $503 billion through next September, said the Congressional Budget Office report. But the adjustments also would cause the economy to shrink by 0.5 percent next year. The report, updating an analysis from last May, comes as a newly re-elected President Obama and Congress seek ways to avert or at least ease possible damage from the scheduled changes. All sides are promising cooperation, but many difficult decisions await and the politics of raising tax revenue and cutting federal benefits programs is exceedingly tricky. The new study estimates that the nation's gross domestic product would grow by 2.2 percent next year if...

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  1. Will Fiscal Cliff Debate Lead to Another U.S. Credit Downgrade?

    AEI Research Fellow Alex Brill on the potential economic consequences of the fiscal cliff negotiations.

  2. The Fate of Charitable Giving Resides on the Fiscal Cliff

    "I have seen Americans making great and sincere sacrifices for the key common good and a hundred times I have noticed that, when needs be, they almost always gave ea...

  3. Democrats seek leverage as fiscal cliff looms

    Democrats are going all-in in a fiscal game of chicken, saying they'll let everyone's income taxes rise on Jan. 1 and slash defense spending amid 8-plus percent unem...

  4. 'Fiscal cliff' vs. consumers, investors

    Shadow hanging over US economy?

  5. Lawmakers May Delay 'Fiscal Cliff' Deadlines

    Slowly and quietly, the U.S. Congress may be arriving at a consensus on how to avoid falling off the "fiscal cliff" on December 31 - by simply putting off its own de...

  6. Fiscal Cliff : Avoid or Drive Right Over It?

    FBN's Rich Edson on Washington's position on fixing the fiscal drag.

  7. Why Should You Care About the Fiscal Cliff ?

    FBN’s Gerri Willis on the potential tax hikes Americans are facing.

  8. 'Fiscal cliff' stalemate heats up

    Where are negotiations headed?

  9. Looming fiscal cliff sparking new fears from taxpayers

    Should taxpayers be worried?

  10. 'Fiscal cliff' threat unsettling small business owners

    Mike Emanuel reports from Washington, D.C.

  11. Wilbur Ross on Fiscal Cliff , Debt Ceiling

    WL Ross & Co. Chairman Wilbur Ross on the fiscal cliff negotiations the debt ceiling and the potential growth of U.S. natural gas.

  12. Economy a Higher Priority for DC Than Fiscal Cliff ?

    Economic Policy Institute’s Christian Dorsey on why lawmakers should focus more on boosting the economy’s recovery.

  1. Who Won, Who Lost From the 'Fiscal Cliff' Deal?

    The "fiscal cliff" drama that ended at the midnight hour on the first day of the year was essentially a knock-down drag-out fight over how to close the budget defici...

  2. The Fiscal Cliff's Impact on Small Business

    The so-called "fiscal cliff" refers to an automatic $560 billion in tax increases and spending cuts that would go into effect, beginning in January 2013, to reduce t...

  3. Will the Sequester Have Any Effect on the Markets?

    Russell Investments chief economist Mike Deuker discusses the effect of sequestration on the markets.

  4. Big Corporations Urge for Deal on Fiscal Cliff

    FBN’s Liz MacDonald on the impact of the fiscal cliff on retailers and customers.

  5. Will America Avoid the Fiscal Cliff ?

    Congressman Michael Burgess (R-TX) talks to Alan about Obamacare, a flat tax and the Fiscal Cliff .

  6. DC Report: Avoiding the Fiscal Cliff

    Washington focuses in on the expiration of the Bush tax cuts and a new round of mandatory spending cuts that will kick in January 1st.

  7. Will Fiscal Cliff Deal Impede Economic Growth?

    Tax Foundation President Scott Hodge on the impact of the fiscal cliff deal and the increase in federal taxes.

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