Why the Fiscal Cliff is Called the Fiscal Cliff
If you’re in charge of US monetary policy and trying to accelerate a recovery amid a devastating long-term unemployment problem, you want fiscal policy to either complement your efforts or at least be neutral, not work against you. “Fiscal cliff” is a lot easier than “policies contributing to tighter fiscal policy beginning next year”.
Over at the Financial Times, Cardiff Garcia has a great explanation about who coined the “fiscal cliff” (Ben Bernanke), why it has stuck, and why it’s a dumb name (“If policymakers don’t work out a solution by January 1st, the harm is not immediate. Nor is it irreversible, nor is it even all that perilous at first.”)
Also, according to Rep. Jeb Hensarling of Texas, chairman of the House Republican Conference, “the best time to work on a bipartisan basis is right after an election.” Mitt Romney may actually be useful in this case.