Falling off the Fiscal Cliff

He's only half right. Increased taxes will reduce investment and distort savings, but reduced Federal spending will actually help the economy. Federal spending is overhead and it has to be financed by borrowing since tax increases will lower investment, increase tax avoidance, revenues will not grow or will decline. Reduced spending in contrast removes dead weight loss from the economy and frees people doing harmful things to seek work doing productive things. Reduce welfare would cause some folks to seek work or relevant training. This will add output and revenues while cutting spending. The notion that cutting Federal spending is harmful is Keynesian and wrong.