ALEXANDRIA, Va. — Have you heard the term "fiscal cliff" lately? According to both
political and financial analysts, it looks like the United States is
headed for one at serious speed.

Here's some background.

About
a year ago, Congress passed the Budget Control Act of 2011, which
established a bipartisan "supercommittee" tasked with addressing
America's debt ceiling crisis. They had until the end of November 2011
to pass a budget that would decrease the deficit by $1.2 trillion over
the next 10 years. Their inability to do so triggered another part of
the act requiring sequestrations (massive budget cuts to both defense
and domestic spending) slated to take effect Jan. 2.

The cuts will total
$110 billion per year until 2022 — not exactly chump change.

At
the same time the sequestrations will take effect, the exemptions to the
alternative minimum tax and the extension of the Bush-era tax cuts will
both expire. In addition, the social security payroll tax cut will
terminate and new taxes imposed by the Patient Protection and Affordable
Care Act will be applied. Finally, the Death Tax will go from applying
to estates of $5.1 million to $1 million and rise from a 35 percent rate
to 55 percent.

That dangerous combination of tax hikes and
spending cuts equals a fiscal cliff. Picture the America economy tipping
over the edge like Wile E. Coyote, except with less foresight and
personal responsibility.

The Congressional Budget Office (CBO) has
predicted that if the fiscal cliff is not avoided, economic growth in
2013 will diminish from 1.1 percent to 0.5 percent, unemployment will
rise from 8.3 percent to 9.1 percent, and the chance of another
recession will increase dramatically. If Congress and the president kick
the can down the road, employing more patchwork extensions to avoid the
cliff completely, the CBO says Americans can expect public debt to rise
from 69 percent of the GDP in 2011 to 100 percent by 2021 and 190
percent by 2035.

This is not a simple problem with a simple
answer. In the next few months Congress and the president need to earn
their keep by making some tough decisions. Not extensions, not more
delays and patches, but decisions. You know, those things us business
owners make every day to remain operational.

The uncertainty that
has existed since August of last year when the Budget Control Act
passed, has had a chilling effect on our businesses and our economy. It
prevents Americans from making long-term plans or addressing potential
financial challenges. We don't know what the future holds because our
elected officials seem content to set deadlines and consequences and
then blow blithely by them at 60 mph.

Can you run a small business like that? No way. Can you run a country like that? Hopefully we won't find out in 2013.

Ray Mungenast is chairman of the American International Automobile Dealers Association.