Under the debt ceiling deal, Congress' failure in 2011 to produce a deficit reduction bill with at least $1.2 trillion in cuts triggered some $1 trillion in across-the-board spending cuts or "sequestrations" - including to social programs such as Medicare and to the Defense Department - to begin in January 2013 and extend over 10 years.
These automatic cuts would coincide with the expiration in the new year of the Bush-era tax cuts as well as payroll tax reductions and federally funded extended unemployment benefits. The Obama White House and congressional Republicans agreed in December 2010 to extend the Bush tax cuts, including for the richest Americans, until the end of this year, while reducing the payroll tax and extending jobless benefits for the same period.
The combination of these expirations and the mandated deficit reduction measures has been called a "fiscal cliff" that threatens to plunge the economy into a deeper slump.
Comment: Medicare, Medicaid, Social Security and lots of other stuff could be easily afforded by cutting the military budget in half. But for some reason, no one seriously proposes that, even though, if cut in half, the U.S. military would still be the strongest by far in the world. The U.S. can't afford its global empire, but it's those who benefit from the global empire and the military spending that are calling the shots. These pathocrats don't care if the U.S. becomes a Third World kleptocracy where the vast majority are impoverished.