The looming tax hikes and spending cuts are a massive austerity measure, so the most obvious antidote would be more tax relief and government spending in the short-term.
The fight over the Bush tax cuts for the wealthy has taken center stage. But other parts of the fiscal cliff have a disproportional impact on Americans on the other end of the spectrum.
Ordinary Americans are poised to be hit by a big tax hike at the end of the year. But they're either unaware or unconcerned about the pending increase, as consumer confidence has hit a five-year high.
The outline of a fiscal cliff deal is finally coming into view in the Senate. But even among budget experts who like the framework, there's sharp disagreement over how long legislators really have to come up with a deal.
The Tax Policy Center has calculated that the fiscal cliff will raise taxes on 90 percent of Americans, raising the average tax rate 5 percentage points. Here's a closer look at how the tax rate would affect different income groups.
While much of the opposition has focused on the defense sequester, the US Conference of Mayors emphasizes the impact of its domestic spending cuts, pointing out that much of the spending will hit state and local budgets.
Douglas Elliott doesn't want the United States to jump off the fiscal cliff. But he can imagine Congress reaching a point at which it could be the best available option.
Clinton's tax hikes ultimately helped fuel growth to the extent that they were part of his broader deficit-reduction package. Obama wants to pass a similar plan, but that doesn't mean we'll see a repeat of the 1990s.
Rep. Steve LaTourette became the latest moderate Republican casualty on Capitol Hill, citing the partisan deadlock for his decision to retire. But even he refuses to let the Bush tax cuts expire in 2013.
One funny thing about the Senate's vote last night to extend the Bush tax cuts for income under $250,000: it was a vote of the Senate. Usually, taxing and spending bills originate in the House because of the "origination clause" in Article I of the Constitution. So Republicans think the bill's Senate origins mean it cannot become law.
Democrats are now threatening to go over the fiscal cliff on Jan. 1 if Republicans aren't willing to agree to tax hikes for the wealthy. Technically, that means that the Bush tax cuts for everyone will expire, including middle-class and ordinary Americans. But there's also a way for Congress to apply the Bush tax cuts retroactively, although it wouldn't be without its own complications.