Another few days have gone by, and the U.S. government still hasn't reached a deal to avert the "fiscal cliff"--the combination of spending cuts and tax hikes that are due to go into effect on Jan. 1.
These changes are more like a "squeeze" than a "cliff," but they are expected to slow U.S. growth and perhaps throw the economy back into a recession.
So lawmakers are eager to reach some sort of compromise that will reduce the changes and lessen the blow.
In the past few days, the country has been treated to TV appearances by both sides, in which they pronounce each other's position as ridiculous and refuse to even come to the bargaining table. But Wall Street and Washington insiders still expect that we'll get a deal.
Heidi Moore, the Finance and Economics Editor for The Guardian, agrees.
Moore recently "translated" a letter that the Republicans in Congress sent to President Obama that outlined their opening budget counteroffer. The original letter, Moore says, was "huffy" and impenetrable, and Moore produced a much clearer version.
Moore also thinks that what we've seen in recent weeks is just theater: Both sides are publicly taking extreme positions they know don't stand a chance of being accepted, with the aim of appealing to their respective "bases" and establishing a position that they can later compromise from. There's plenty of time left in the year, Moore says, and if the talks slipped into January, it wouldn't be the end of the world. The whole idea of a "cliff," after all, is misleading.
More from The Daily Ticker:
- Politics & Government
- Budget, Tax & Economy