Chart of the Day
Posted at 12:15 p.m. on Nov. 30, 2012
– Chart breaking down the impact on GDP of each component of the “fiscal cliff,” ranked by the likelihood that Congress will fail to act on each component, via the Economist.
“The total hit is about 5% of GDP. Barack Obama and Congress are most intent on avoiding the expiration of George Bush’s tax cuts on the middle class, and the automatic spending cuts (called a ‘sequester’). Those equal about 2% of GDP. But the parts that are almost certain to occur—expiration of the payroll-tax cut, imposition of discretionary spending caps—still equal a hefty 1.9% of GDP, quite a lot for a still weak economy to support.”