Peering Over The Fiscal Cliff

The CBO calculates the impact of the Bush tax cuts expiring and the scheduled spending cuts. TPM charts the possibilities:

Fiscal cliff

Ezra Klein imagines the political implications from the "No Fiscal Restraint" option:

[4.4 percent growth in 2013] sounds fairly optimistic to me. But let’s assume, for a minute, it isn’t, and that it actually happens. Then either Barack Obama or Mitt Romney, without introducing any major new policies of their own, would be presiding over 4+ percent growth. Politically, that would be huge for them and their party. The midterms would likely be a cakewalk — you don’t want to change horses mid-gallup, do you? And it would likely have the effect of legitimizing whatever their platform was.

Should the "Fiscal Cliff" scenario become reality, Yglesias argues that the Fed should do everything in its power to lessen the pain.