US plunge off 'fiscal cliff' is likely, say debt gurus Simpson and Bowles (+video)
Former chairs of Obama's debt commission, Alan Simpson (R) and Erskine Bowles (D), said at the Monitor breakfast Wednesday they see just a one-third likelihood that the White House and congressional Republicans will reach a deal by year's end to avert the fiscal cliff.
Fresh from a meeting with President Obama and en route to talk with House Speaker John Boehner, the former co-chairmen of the bipartisan Simpson-Bowles debt commission say it's more likely than not that the United State will fall off the "fiscal cliff" at year's end.
There's only about a one-third possibility that Congress and the White House will reach a deal to avert some $600 billion in automatic tax hikes and mandatory spending cuts over 10 years – an outcome that would be "devastating to the economy," says Erskine Bowles, the Democratic half of the Simpson-Bowles partnership, speaking to reporters at the Monitor breakfast in Washington on Nov. 28.
There's another one-third possibility that "we'll go over the cliff and people will come to their senses in the first week or so," he adds. A third prospect, that a deal takes even longer, "will lead to chaos," he predicts.
Mr. Bowles and former Sen. Alan Simpson (R) of Wyoming have stayed engaged with members of Congress, the White House, business and other interest groups, and the public since releasing a report in December 2010 recommending a $4 trillion "balanced" solution to America's debt crisis. That plan included a package of tax hikes, spending cuts, and reforms to save money on big entitlement programs such as Medicare.