You may have heard the term ‘fiscal cliff’ without understanding what it’s all about. In this documentary, made by the Wall Street Journal, we are taught everything we need to know about the fiscal cliff but were afraid to ask.
In a nutshell, unless the law is changed, there will be tax increases and spending cuts at the beginning on January 2013 that President Obama and Congress passed in order to hack away at the ever-growing public debt. The problem with this is that these changes are considered too dramatic and abrupt and the US economy will go over ‘fiscal cliff’ unless alternative measures to reduce the deficit are implemented. Going over this cliff, many expert economists agree, will send the US into a renewed recession.
Great video for getting to understand the fiscal cliff as well as for learning some basics on government economic policy.