Little confidence bipartisan solution to fiscal cliff will be reached before deadline
The fractious political environment and the fiscal cliff have emerged as the two news stories most affecting Affluent investors’ economic outlook, according to a new survey conducted by Millionaire Corner.
Nearly half (48 percent) of Affluent households said that partisan clashes between the White House and Congress is the news story that has the most impact on their economic outlook. This is up from 40 percent in August, when this question was last asked. Nearly one-third (32 percent) of affluent respondents said the fiscal cliff is the leading news story affecting their economic outlook. Both are inextricably linked, as the White House and lawmakers remain deadlocked on reaching a solution to the tax cuts and mandatory spending cuts scheduled to take effect at year’s end.
The stakes are high: It is estimated that no deal on the fiscal cliff—the tax increases and spending cuts scheduled to take effect by the end of the year--would raise the average U.S. household tax burden by $3,500. Analysts caution that the country could slip back into a recession should the fiscal cliff not be averted.
Entreaties by President Obama and House Speaker John Boehner for each side to reach a bipartisan solution have thus far come to naught. On Wednesday, talks between the White House and House Republicans broke down..
Affluent investors surveyed by Millionaire Corner in November are not confident both sides will come together. Nearly two-thirds (62.5 percent) said they do not believe the White House and lawmakers will resolve the issue before the first of the year. Households with a net worth of less than $100,000 were the most pessimistic, with 69 percent stating they did not think a bipartisan solution would be reached before the deadline.
Across age levels, Affluent investors between the ages of 41-50 were the least optimistic (just 29 percent) that the nation’s political leaders would avoid taking the country over the cliff.
Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.
A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.