The fiscal cliff and US foreign policy
International leaders should tell the US that the dysfunctionality of its domestic politics is a global problem.
The world should be worried. The possibility that US President Barack Obama and the Republicans in Congress will fail to reach a compromise before mandatory deep spending cuts and tax increases take effect on 1 January is very real. Global markets are well aware of the danger of the United States falling over the ‘fiscal cliff’, and are watching nervously. They know that this outcome could well throw the US – and the world – back into recession.