Fiscal Cliff: Dem Plans Collide With CBO Projections

More Democrat Thelma and Louise Economics

Will Democrats Dial Back Their Plan To ‘Plunge Off The Fiscal Cliff’ As CBO Turns Up The Heat On Consequences?

CBO Projects ‘Significant Recession,’ ‘Jobless Rate Rising’

NATIONAL JOURNAL: “CBO: Jumping Off Fiscal Cliff Would Cause Recession” (“CBO: Cliff Would Cause Recession,” National Journal, 8/22/12)

NEW YORK TIMES: “…if Congress takes no action to stave off tax increases due and automatic budget cuts scheduled to take effect on Jan. 1, the economy could fall into a recession, with total output shrinking and the jobless rate rising to about 9 percent in the second half of 2013… Fears about tax increases and spending cuts — the ‘fiscal tightening’ — are depressing economic growth…” (“Report Sees Risk Of Recession If Budget Stalemate Persists,” The New York Times, 8/22/12)

WASHINGTON POST: “The nation would be plunged into a significant recession during the first half of next year if Congress fails to avert nearly $500 billion in tax hikes and spending cuts set to hit in January…” (“Significant Recession Imminent If Congress Doesn’t Act On Fiscal Cliff: CBO Report,” The Washington Post, 8/22/12)

REUTERS: “…even worse economic damage than previously thought if Washington fails to come up with a solution, Congress' budget referee said on Wednesday.” (“U.S. CBO Sees Deeper ‘Fiscal Cliff’ Recession Next Year,” Reuters, 8/22/12)

AP: “… fresh, dire projections by the nonpartisan Congressional Budget Office.” (“Analysts: Recession Likely Without Budget Accord,” AP, 8/22/12)

CBO: “…a recession, with real GDP declining by 0.5 percent between the fourth quarter of 2012 and the fourth quarter of 2013 and the unemployment rate rising to about 9 percent in the second half of calendar year 2013.” (“An Update To The Budget And Economic Outlook: Fiscal Years 2012 To 2022, Congressional Budget Office, 8/22/12)

Dem Plan: ‘Risk Racing Over The Fiscal Cliff’

“…Democratic Senator Patty Murray said her party is willing to risk racing over the fiscal cliff and into financial chaos in 2013.” (“US Lawmakers Head Home, Severe Challenges Loom,” AFP, 8/4/12)

“Democrats say they are prepared to go over the so-called fiscal cliff at the end of the year ...” (“Democrats Risk Fiscal Cliff By Targeting Top Earners’ Break,” Bloomberg News, 7/10/12)

“Democrats have made clear that they are ready to allow tax rates to rise and automatic cuts to kick in for both defense and domestic programs... Sen. Patty Murray, D-Wash., who outlined the Democratic strategy in a speech this month, put the GOP on notice that her party would rather plunge off the fiscal cliff than extend tax cuts for the wealthiest Americans. White House aides pointedly backed Murray's threat on Tuesday.” (“Democrats Waxing Tough On Fiscal Cliff,” National Journal, 7/25/12)

• SEN. PATTY MURRAY (D-WA): “So if we can’t get a good deal… then I will absolutely continue this debate into 2013… our country is going to have to face the consequences…” (Sen. Murray, Remarks At The Brookings Institute, 7/16/12)
• SEN. MARK BEGICH (D-AK): “There are more people today than before that say let this all just expire out.” (“Geithner Meets Murray Amid Fears Lawmakers Might Not Stop Fiscal Cliff,” The Hill, 8/2/12)
• SEN. HARRY REID (D-NV): Q: “Do you agree with Senator Murray that if you do not get a balanced deal, you'll fight this into 2013?” SEN. HARRY REID (D-NV): “…Patty Murray knows what she's talking about.” (Sen. Reid, Press Briefing, 7/17/12)

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