Justin Wolfers*, Prof in Econ at the U of Michigan

[BlueCaliDem]

Last edited Tue Nov 27, 2012, 02:03 PM - Edit history (1)

was on Now with Alex Wagner, and he claims that if no deal is made and we actually go over the fiscal cliff (happens in about three months after January 1st), that, yes, the deficit will be wiped out, but we'll be in a recession.

Is this true?

*edited for typo

[Festivito]

1. I'd suggest we'd be heading back into a recession.

FDR tried conservative policy in the middle of his presidency. Quickly, the economy soured and he went back to his liberal ideas which set us on course for profitable decades to come.

Republicans argue until I'm nauseous that WWII pulled us out. They just keep fighting for rich revisionism of history.

The 91% max tax rate kept money in the hands of many which gave us an incredible boon to become the envy of the world for decades to come.

[MrYikes]

2. It is my belief (but only my belief)

that the cliff contains a 4% GDP reduction in spending. The loss of that money in our economy will cause a mild recession until October of next year at which time the recovery will continue.

[BlueCaliDem]

3. That's the percentage the professor noted as well. However, he didn't

mention that it would be a mild recession. He left it at recession.

Thanks for the response, MrYikes.