Basically the fiscal cliff is a system that started back when president bush was in office and he had it put into action in 2003. It was known as "bush tax cuts" and when Obama was elected he decided to extend it in the "job creation act of 2010". In late February 2012 the Chairman of the federal reserve (Ben Bernanke) popularized the term "fiscal cliff" for this situation.
Th house financial committee described the fiscal cliff as "A massive fiscal cliff of large spending cuts and tax increases" and it will take place on January 1st 2013 (29 days from today). The deficit is the difference between what the government takes in and and what it spends. They want to reduce it by half in the start of 2013. The congressional budget office estimates the sudden reduction will lead to a recession in 2013 and will start to pick up after 2013.
So basically if this system does not get resolved soon enough and they find out a way that to not send us into a recession at the start of 2013 then everything will seem fine. If they don't figure out a solution soon enough in 29 days or less we the people could possibly be headed strait down that cliff and it would end up being another bad thing that happens in America. Hopefully they will resolve this problem so on December 31st people will not question if the sun will rise in 24 hours or less.
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