Professors Michael Hudson, James K Galbraith and Bill Black variously describe the so-called ‘fiscal cliff’ as a scam, a Trojan and disaster politics. They contend that Obama has deliberately contrived this so-called crisis to ‘discipline’ the Democrats into voting for cuts in securicare, medicare and other privatisations, in return for Republican concessions on higher tax rates for top income brackets.  In the words of Michael Hudson, ‘There is no crisis at all’. Obama has to repay his Wall Street donors with ‘Romney-lite’ austerity cuts.

The possibility of a fiscal cliff was set in motion over the past two years as a way to force action on mounting government debt.

Now, legislators risk looking politically cynical by seeking to weaken the measures enacted to try to force them to confront tough questions regarding deficit reduction, such as changes to government programs like Social Security, Medicare and Medicaid…

Obama’s latest offer set $400,000 as the income threshold for a tax rate increase, up from his original plan of $250,000. It also had a new formula for the consumer price index — called chained CPI… and would result in smaller benefit increases…..

..the change would mean Social Security recipients would get $6,000 less in benefits over the first 15 years of chained CPI. Liberal groups have openly challenged the plan, calling it a betrayal of senior citizens who contributed all their lives for their benefits.

http://edition.cnn.com/2012/12/28/politics/fiscal-cliff/index.html

Fiscal Cliff Trojan November 25, 2012

Michael Hudson: Fiscal cliff was manufactured to shift more of the burden of the crisis onto ordinary people.  (Full transcript at http://michael-hudson.com/2012/11/fiscal-cliff-trojan/)