Fiscal cliff

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Budget deficits projected through to 2022. The “CBO Baseline” shows the effects of the fiscal cliff under current law. The "alternative scenario" is what would happen if Congress extended Bush's tax cuts and repealed the post-2012 spending cuts mandated by the Budget Control Act .

The fiscal cliff (also on fiscal cliff , fiscal cliff and budgetary cliff , English fiscal cliff in the) describes budgetary debate, the United States , the fact that the end of the year expire in 2012, various tax cuts and must contact spending cuts into effect at the same time, so that the public debt of the United States a does not exceed the prescribed maximum value. The fiscal cliff is therefore also compared to the debt brake .

The associated drastic reduction in the budget deficit from 2013 is likely to have a strong dampening effect on forecast economic growth if growth policy countermeasures are not adopted. The deficit - the difference between government revenues and spending - is expected to be cut in half by the fiscal cliff in 2013. However, the Congressional Budget Office (CBO) estimates that the sudden cuts are likely to lead to a recession in early 2013 and that economic activity will not pick up again until after 2013.

The laws, which lead to the fiscal cliff also include tax increases due to the elimination of tax breaks from the Bush era (Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010) and spending cuts in the budgetary control decision ( English Budget Control Act ) of 2011. The Budget Control Act was passed on the failure of the 111th Congress to approve a state budget and was a compromise to deal with the United States' debt crisis. Republicans in Congress refused to approve an increase in the maximum tax rate unless deep spending cuts were also decided to move closer to a balanced budget and reduce the amount of national debt that had accrued. The Budget Control Act also includes an immediate increase in the debt ceiling, along with a mechanism that allows for two more increases. It also provides for automatic spending cuts from January 2, 2013.

It is forecast that as a result of the fiscal cliff in the 2012-2013 fiscal year, tax revenues will rise by 19.63 percent annually and expenditures will decrease by 0.25 percent annually. These changes would bring tax revenues back to roughly their historical average of 18 percent of GDP. Spending remained roughly the same in nominal terms and was at the same level as in 2009. Some larger programs, such as Social Security , Medicaid , state wages (including Sölde and pensions ) and veteran benefits, would be excluded from the cuts. Comprehensive cuts - the so-called “budget sequestration” - would reduce expenditure for the federal authorities and ministries . The deficit reduction aims to slow the growth of US debt. Although it continued to grow, projected debt would be $ 7.1 trillion, or 70 percent, lower over the next decade. This would result in a lower debt to economic output (GDP) ratio . Because of their short-term economic effects, including a possible recession, these changes have generated violent reactions both inside and outside of Congress. It was asked to extend some or all of the tax cuts and replace the savings across the board with more targeted cuts.

In addition, the debate can become heated by the expectation that the debt ceiling will be reached before the end of 2012 if “extraordinary measures” are not taken. Almost all proposals to circumvent the fiscal cliff include extending some parts of the Tax Relief Act 2010 or the Budget Control Act 2011, or both, which in turn increases the deficit through lower taxes and / or higher spending.

Web links

Commons : Fiscal Cliff  - Collection of images, videos and audio files

• What is the Fiscal Cliff? , Council on Foreign Relations
• Between a Mountain of Debt and a Fiscal Cliff , Analysis of the Committee for a Responsible Federal Budget
• Fiscal Tightening in 2013 and Its Economic Consequences - Infographic , Congressional Budget Office, published August 22, 2012
• The 2012 Long-Term Budget Outlook , Congressional Budget Office, published June 5, 2012
• Choices for Deficit Reduction , Congressional Budget Office, published November 8, 2012
• Economic Effects of Reducing the Fiscal Restraint Scheduled to Occur in 2013 , Congressional Budget Office, published May 22, 2012

Individual evidence

1. ↑ Josef Braml : The USA beyond the fiscal cliff , ifo Schnelldienst 24/2012
2. ↑ Rudolf Besch: Consequences of the fiscal cliff , ifo Schnelldienst 24/2012
3. ↑ The fear of the fiscal cliff ( Memento of the original from March 18, 2013 in the Internet Archive ) Info: The archive link was inserted automatically and has not yet been checked. Please check the original and archive link according to the instructions and then remove this notice. , boerse.ARD.de, November 6, 2012  
4. ↑ An Update To The Budget And Economic Outlook: Fiscal Years 2012 To 2022 (PDF; 887 kB) Congressional Budget Office. August 2012. Retrieved October 2, 2012.
5. ^ Jeanne Sahadi: Debt ceiling in play again . Cable News Network. May 22, 2012. Retrieved July 25, 2012.
6. ↑ Jonathan Weisman: 2 Sides in Talks Inch Closer but No Fiscal Deal on Final Day. In: New York Times (online edition). December 31, 2012, accessed December 31, 2012 .