As the fervor of elections slowly draws to a close, early signs indicate an imminent storm of controversy — the so-called “fiscal cliff” — coming our way.
Hyping this “fiscal cliff” is very much on the media machine’s mind. A Google Trends search shows that news reporting of this subject has increased 660 percent since Election Day. The “crisis” is rising into the spotlight as mainstream America’s most contentious political topic.
And true to the Hollywood-style nature of modern media coverage, the climatic deadline happens to be Jan. 1st — after which America will dive off this cliff, and buildings and bridges will fall from the sky.
So what is the commotion about? In early 2013, around $600 billion (some predict $1 trillion) in government spending cuts and tax hikes will take effect. Economists fear this will plunge the struggling US economy back into recession.
Unless the Republican-controlled House and Obama Administration can reach an agreement on how to respond to this situation, investor confidence is predicted to spiral downward as the clock ticks.
Fresh off the election, early signs from both camps have been surprisingly conciliatory this time around. But only the most blatant optimist expects all to remain nice and dandy in Washington.
Republicans will stick to their demands for extending Bush-era tax rates on high-income households. Meanwhile, Obama shows little eagerness to reduce entitlement spending, which the GOP despises with a passion.
All politicians are calling for a “balanced approach” to achieve a Grand Bargain on Capitol Hill. Yet, few realize that the meaning of compromise is to satisfy both sides’ demands. The right and left economic schools of thought are seen as mutually exclusive, although they are not.
This paradigm of “either/or” — which legislators and the media box the public into — must be eradicated to tackle the larger structural issues at hand.
Maybe the media should not portray the “fiscal cliff” as a cliff at all. After all, isn’t a mixture of spending cuts and tax increases exactly what both sides implicitly call for when demanding concessions from one another?
Maybe nature — or randomness, or George Bush — is giving policymakers a much-needed lesson on what negotiation really means in a divided government. The only way to enact a policy is by allowing rivals to accomplish their goals.
The fiscal fiasco, or whichever hash-tag is trending by the time this goes to press, is exactly that.
And despite the doomsday warnings broadcast by our favorite networks, the exact effect of this situation is strikingly difficult to forecast. On previous form, we are unlikely to find out, but the U.S. will survive nevertheless.
The key issue lies in the fact that politicians mislead people to believe that their economic strategies will curb the deficit, shrink sovereign debt, fix unemployment and inflation, and boost GDP all at once.
If anyone really has the solution to achieving simultaneous growth and austerity in tough economic times, our friends across the pond are open to suggestions.
No more temporary fixes and no more stalemates. Until politicians realize the hypocrisy inherent in their agendas, Washington should welcome the fiscal cliff with open arms.