Holtz-Eakin: Fiscal Clilff 'an Enormous Hit'
Daily Ticker Interview July 20, 2012 America is headed for a fiscal cliff if members of Congress fail to act before the end of the year. Many economists agree that if no action is taken, 2013 will begin with a $600 billion drag on the economy, or a 4 to 5 percent hit to GDP, due to a combination of tax hikes and budget cuts set to take effect. To put that in perspective, the knock to economic growth could be twice as much as current GDP growth forecasts for all of 2012 and more than any annual GDP growth in the last decade. Former Treasury Secretary Robert Rubin said this week at the CNBC Institutional Investor Delivering Alpha conference that the impact of the fiscal cliff could be worse than the fallout from the 2008 financial crisis, which resulted in the worst recession since the Great Depression. A new report by the American Action Forum forecasts between 2.8 million and 10 million jobs could be lost as a result of falling off the cliff based on a set of GDP eco...