What do economists think will happen with the fiscal cliff? Opinion is highly divided, but the vast majority can agree on one thing: Taxes will go up.
The National Association of Business Economists surveyed a group of economists at leading corporations and financial analysis firms, along with a handful in government.
A full 59 percent believe that the payroll tax holiday is done for, meaning the average household would face a $1,000 tax hike.
But opinion is more divided when it comes to the Bush tax cuts: 36 percent believe they'll expire for high-income earners but not lower-income ones (what the Democrats want), while 55 percent believe that all of the Bush tax cuts will be extended for another year (what Republicans are demanding). So while most believe that taxes are likely to go up next year, it's more uncertain how much they'll rise.
By contrast, there's a lot more consensus that Congress will find some way to avoid the automatic cuts in the sequester — with 77 percent believing that the cuts will be "greatly" diminished by subsequent legislation, and an even greater number expecting that the appetite for spending restraint overall will be diminished. So, it's safe to say that most economists aren't anticipating that a grand bargain between congressional Republicans and the administration of major spending cuts and tax reform will be happening any time soon.