As President Obama and lawmakers try to find a formula for spending cuts and tax increases, they might look across the Atlantic for insights from those who have been wrestling with budget problems. The first lesson from Europe's "fiscal consolidation" experiences: It will hurt.
If Congress fails to reach an agreement on tax increases and spending cuts this year, it will mean sharp reductions in a broad swath of federal spending, from defense and Medicare to education and unemployment benefits. Economists say the cuts would be a serious setback for the economy as a whole.
The president and House Republicans continued to snipe at each other Wednesday over the impending set of automatic tax hikes and spending cuts known as the fiscal cliff. President Obama and House Speaker John Boehner later spoke briefly by phone for the first time in a week, according to reports.
About 2 million Americans could lose unemployment checks if Congress doesn't extend emergency federal benefits by the end of the year. Host Michel Martin talks about new research challenging conventional wisdom about unemployment checks. Guests include James Sherk of the Heritage Foundation and Judy Conti of the National Employment Law Project.
Clerical workers walked out a week ago, demanding guarantees that their jobs won't be outsourced in the future. Longshoremen wouldn't cross the picket lines, bringing the nation's busiest ports to a standstill. But work should resume there today.
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