Fiscal Cliff? Fiscal Hoax

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Peter Hart writes at OtherWords:

The biggest story in Washington is about something that doesn’t really exist: the so-called ”fiscal cliff.” This manufactured panic is all about politicians and corporate interests getting things they want — things that don’t have much to do with the ”crisis” anyway. But instead of challenging this spin, big media outlets are playing along.

So what’s the not-really-a-cliff anyway? It’s a number of things that are set to happen all at once starting in January. On the one hand, there are budget cuts, more or less equally divided between military and domestic spending. The threat of those cuts was supposed to force Congress to reach a deal last year. It didn’t.

Add in the expiration of the Bush-era tax cuts and a temporary cut in the Social Security payroll tax and it starts to really add up. That’s what’s causing these breathless TV reports telling you that if Congress and the White House don’t act in the next few weeks, the average family’s tax bill will go up an astonishing $3,500.

Astonishing, sure. And if it all happened, the country would very likely be thrown into another recession. But will it happen? That’s extremely unlikely. And is it really a cliff? Absolutely not.

A cliff, literally speaking, isn’t something you can fall off only a little bit. But this tax and spending problem could go right into January without much disruption for taxpayers or the economy. And there are plenty of ways to make sure that most Americans won’t see a massive tax increase. Those scary numbers you’re hearing rest on the assumption that no deal is reached for the entire year.

So why call it a cliff then? To make it seem like an immediate response is essential. There are powerful interests looking to use a ”crisis” to push for policy changes that have nothing to do with the current problem. So you might turn on the TV and hear the millionaire CEO of a major corporation say the cliff is really about the ”need” to cut the earned-benefit programs Social Security and Medicare.

Oh, they don’t call them ”cuts” — they prefer to talk about ”reforming” our ”entitlement programs.” But they’re talking about cuts that aren’t a required part of what it will take to get the country’s fiscal house in order. Social Security and Medicare spending isn’t, in fact, what’s causing the fiscal problems we’re told must be solved.

And the fact that some of these CEOs are the same Wall Street wizards who played a key role in creating the housing crisis and the Great Recession, which actually did cause fiscal woes by depressing tax revenue at the local, state and federal levels, doesn’t come up. We’re supposed to see them as responsible stewards of the economy.

Read more here.

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  • BuzzCoastin

    the fiscal cliff they’re yammering about
    is to distract attention away from the real fiscal cliff
    that the world economy went off in 2008

    round and round it goes, where it stops nobody knows

  • Tomahawk

    Always the same method: politics feed the media with meetings and make the people think, that they really fight for a solution. They fail of course and propagate that their are no alternatives. It’s scripted – same thing here in europe, where the puppets play great theater since 5 years. Finally always the worst case becomes reality – the people consume it as long they have enough time to forget and go back to their shitty everyday life. The elite calls it “fiscal cliff” in the US: “if you don’t pay your debt, something terrible will happen!”. No alternatives. Really. Same shit in every country, we are all in the same boat. And it’s not an american policestate that get’s ready to rumble – it’s a global one. As the german Wolfgang Schäuble said when he was asked why the euro-crisis is not a bad thing: “Crisis means possibility to make laws that are unthinkable without it …”