Fiscal Cliff

Correct me if I'm wrong, but generally we're only hearing about the tax cuts that will expire on December 31, 2012.

I haven't heard much talk about the automatic spending cuts that will take effect, beginning January 1, 2013 if no budget plan is reached.

There has to be a reason we're not hearing about the automatic cuts.

Sequestration will hit California particularly hard, Victor Valley Daily Press.

California will be hit hard by sequestration, the automatic spending cuts in the federal budget set to go into effect Jan.1 unless Congress agrees on a plan by year end to reduce the federal deficit by more than $1 trillion, according to a study by an private economic development council.  

If sequestration goes forward, combined with the earlier mandated cuts to the Department of Defense, the state will lose 336,000 defense-related jobs, $21 billion in economic output and $6.9 billion in personal earnings over the next eight years, according the Southern California Leadership Council and the Southwest Defense Alliance. 

Sequestration will account for 136,000 of these lost jobs, $7.5 billion in reduced economic output and $2.4 billion in lower personal earnings, the study revealed.
Sequestration calls for $1.2 trillion in spending reductions from fiscal years 2013 through 2021 from both defense and non-defense departments. 

However, defense spending will be disproportionately affected. The Department of Defense accounts for 19 percent of the federal budget but is slated to take 50 percent of the required sequestration cuts, meaning that the Pentagon must cut $492 billion in military spending over the next 10 years. This is on top of the $487 billion already set to be cut from the defense budget over the same decade.

Wow, This Says It All -- Detroit Unnerved By Fiscal Cliff; Government Motors Sees No Need To Plan For Fiscal Cliff; Ford Plans

Updates

December 4, 2012: GM getting ready to idle plants due to excess inventory.

December 3, 2012: GM truck inventory up to 140 days; healthy number -- 70 days.


November 29, 2012: this is not an update to the story below. But the story brings back wonderful memories. General Motors is bringing the Chevy SS back to market.

The SS replaces the Chevy Impala as GM's race car in NASCAR.

Chevy has long used the SS (Super Sport) designation on high-performance models. It first appeared in 1957 on a Corvette prototype race car, and the fist production vehicle with an SS option package was the 1961 Impala. The SS designation returned to the Chevy lineup in 2010 with the debut of the fifth-generation Camaro.

The first car I ever owned was a 1973 Chevy Nova SS. One of the best cars I ever had.  I had to sell when the Air Force assigned us overseas back in 1983.

Original Post

Link here to Bloomberg.

Ford Motor Co., the second-largest U.S. automaker, is making contingency plans should the nation’s economy falter if President Barack Obama and Congress go over the fiscal cliff. Its main domestic rivals aren’t.

The looming fiscal cliff has Detroit unnerved. Just as the auto recovery picks up speed, the administration that saved the industry now could bring it to a screeching halt. Auto demand would plunge as much as 20 percent if Washington can’t find a solution to avoid a lethal combination of tax hikes and spending cuts coming at the end of the year, said Lacey Plache, chief economist of auto researcher Edmunds.com.

General Motors Co. isn’t making specific contingency plans ,...

I can't make this up. Verbatim cut and paste from Bloomberg.