Why You Should Care About the Fiscal Cliff

The president of the Committee for a Responsible Federal Budget and the head of the non-partisan Campaign to Fix the Debt explains the fiscal cliff and why politicians are still wrangling over it

by Lesley Kennedy • MORE.com Reporter
maya macguineas image
Maya MacGuineas, head of the Campaign to Fix the Debt, says going over the fiscal cliff would be "devastating."
Photograph: Campaign to Fix the Debt

MM: One part of it is politics. You haven’t seen a lot of working together recently. Two, it’s really hard. In this country, we have been borrowing beyond our means for decades. Undoing that means doing all the difficult policies—raising revenue, cutting spending, reforming entitlement programs—things that can be done in a smart and thoughtful way, but they’re still politically difficult. And third, until recently, I don’t think the public understood how important (dealing with the nation’s debt) is. … Until recently, I think deficits were really just a confusing and removed issue. Now I think people can see that it’s different, but not all that different, from a household. You can’t borrow beyond your means with no plans to repay it indefinitely.

MORE: Do you think an agreement will be reached?

MM: The mood changes so regularly, it’s very hard to see behind the curtain here. We’re talking with everybody on all sides, and I truly believe they care about getting a deal and they understand how important it is for the country. I think we won’t go off of the cliff.

MORE: What would going off the fiscal cliff mean to MORE readers?

MM: It’s devastating. Recessions are bad enough, in that they come along in a regular business cycle and hurt people so badly, but for the country to have a self-imposed recession is truly unforgiveable. There are so many jobs that are on the line, that if we were to go off of the cliff and start seeing more joblessness instead of less it would be a devastating set-back. It will have an effect on wages, it will have an effect on the stock market. Basically, we could all become both poorer and more uncertain.

As the chief economist for the White House said, some of the biggest damage would come from the psychological damage that comes from saying our government truly can’t govern.

MORE: What can each of us do?

MM: People should pick up the phone and call their members of Congress and write them letters and say we want you to work together to fix the problems of the deficit and the debt in this country. There’s nothing high-tech or magic about it. Politicians don’t like to do hard things – just like none of us do – so they need to hear that you are watching and that you care.

Next: 11 Last-Minute Tax Moves to Make in 2012

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