Two fiscal cliffs slows economic recovery

No problem, only two cliffs

But whatever it is, is better than the alternative.    

The San Mateo Daily Journal/Associated Press/Judy Lin, 1/3/12. "Fiscal cliff deal to aid California."

"SACRAMENTO  — The deal in Washington to avoid the “fiscal cliff” will bring a reprieve to California’s slowly rebounding economy, but uncertainty remains in part because Congress delayed action on federal spending cuts. 

The agreement helps California avoid sliding back into recession, H.D. Palmer, finance spokesman for Gov. Jerry Brown, said Wednesday. But economic forecasters said the two-month delay on the sequestration cuts could lead businesses to delay hiring or investments.

“To the extent that this agreement averts a national recession — and the revenue loss associated with it — then we will have dodged a bullet,” Palmer said a day after Congress reached the deal."  Read article.

Related articles -  Reuters, Thomas Ferrano and John Whitesides, 1/3/13, "Bigger fights loom after 'fiscal cliff' deal." President Barack Obama and congressional Republicans face even bigger budget battles in the next two months after a hard-fought "fiscal cliff" deal narrowly averted devastating tax increases and spending cuts." 

The Economist, 1/5/12 print edition, "The fiscal cliff deal, American's European movement"  "FOR the past three years America’s leaders have looked on Europe’s management of the euro crisis with barely disguised contempt. ...  America’s economy may not be in as bad a state as Europe’s, but the failures of its politicians—epitomised by this week’s 11th-hour deal to avoid the calamity of the “fiscal cliff”—suggest that Washington’s pattern of dysfunction is disturbingly similar to the euro zone’s in three depressing ways. ..  1) .. an inability to get beyond patching up, 2) the outsize influence of narrow interest groups.. 3) ..politicians have failed to be honest with voters."

Posted by Kathy Meeh