If America falls off the fiscal cliff, there’s going to be a hell to pay, and fewer workers to pay too.
Around 277,000 public sector workers will be laid off if Congress doesn’t take action to avoid a series of spending cuts related to the country's “fiscal cliff,” a measure to bring down the deficit that includes both tax hikes and reductions in spending, according to a report by George Mason University’s Center for Regional Analysis. As of now, $1.2 trillion worth of spending cuts will begin to take effect on January 2, 2013, and continue over the course of a decade, resulting in a projected 14 percent reduction in the government workforce.
Many government departments, from the U.S. Department of Agriculture to the Federal Aviation Administration, will be affected.
"What that means is some airports won't be able to land as many planes, because FAA controllers won't be in the towers," Stephen Fuller, director of the Center for Regional Analysis, told CNNMoney. "FBI agents won't be on the ground investigating and meat inspectors won't be inspecting."
The report also finds that the fiscal cliff could reduce the country’s GDP by $215 billion and reduce personal earnings by $109.4 billion.
Such reports of the fiscal cliff's negative effects are nothing new, however. A recent Senate report found three critical education programs will lose $2.7 billion over ten years because of the cuts.
Those effects of such cuts will likely prove enormous. Indeed, the Congressional Budget Office estimates that the U.S. economy will enter a recession next year if the fiscal cliff is not avoided.