Fiscal Cliff: What Congress Should Do
Having squandered most of 2012 with posturing and delay, Congress and the President are now careening toward a budgetary precipice of their own making. The so-called fiscal cliff will be reached just after New Year’s Eve—bringing a nearly $500 billion tax hike in 2013 and a devastating 10 percent reduction in national defense spending—unless lawmakers and the White House change course. They need to act swiftly but not hastily, nor should they overreach. Lawmakers ought to take care of the task at hand, focusing solely on stabilizing the immediate situation. They should: preclude the huge tax hike known as Taxmageddon; prevent the reckless, automatic defense cuts, preferably by choosing alternative savings; renounce any other tax increases; resist the temptation to conjure further ad hoc budget schemes and grand bargains; and return as soon as possible to the regular practice of congressional budgeting.