The fiscal-cliff negotiations have deteriorated into an embarrassing travesty of competing press conferences, off-the-record remarks, closed meetings, and sound bites. The Republican side is frustrated and flabbergasted by the absence of a concrete proposal from the President that can be scored by the Congressional Budget Office and then “marked up” by Congress according to standard procedures. Vague offers of so and so many trillions of revenue increases and spending cuts spread over a decade are just words, not real proposals.
The last serious fiscal-cliff projections date back to the Congressional Budget Office’s (CBO) August 2012 assessment of the budgetary effects of various fiscal policy alternatives. In its August study, the CBO – the “gold standard” of budget projections — calculated the budgetary consequences of going over the fiscal cliff in its “baseline projection.” It then projected the budgetary effects of alternative fiscal policies, among them, extending the Bush tax cuts and shelving the sequestered spending cuts.