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Could 'fiscal cliff' push US into recession? Four questions answered

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Tea party protesters have helped made the debt a top priority in Washington.

Whitney Curtis/AP/File

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3. Why not push the whole thing off a year?

The CBO points out that the reason we’re having this debate is because of America’s long-term debt problems.

At present, the America’s debt held by the public stands at 73 percent of its GDP. Under a middle-of-the-road scenario constructed by the CBO – which allows some tax cuts or spending increases to continue while disallowing others – debt would rise to 93 percent of GDP by 2022. 

Without changes, “debt would be substantially higher,” the CBO wrote. “However, debt cannot continually increase as a share of the economy: Policy changes would be required at some point. The longer the necessary adjustments in policies were delayed, and the more that debt increased, the greater would be the negative consequences.”
 
 What would the negative consequences be?

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