The Super Committee's failure to reach a deficit-reduction deal leaves a host of problems in its wake, including the expiration of tax breaks and unemployment benefits and tremors of uncertainty in the stock market. While failing to tackle the nation's long-term deficit was its chief failing, here's who else is affected by the committee's collapse:
Markets U.S. stocks were the first to take a hit on news this morning that the committee will likely declare defeat this afternoon. Stocks plunged with the Dow Jones industrial average falling more than 250 points and the S&P 500 dipping 2.2 percent. On top of the major indices, Bloomberg reports that "The 10-year yield fell six basis points to 1.96 percent at 9:13 a.m. ... The benchmark Stoxx Europe 600 Index lost 1.9 percent, extending last week’s sell off, and the MSCI Asia Pacific Index dropped 1.5 percent."
Middle class Another issue that has now been tabled is the extension of payroll tax cuts and jobless benefits for millions of Americans. The Super Committee was expected to include these priorities in an agreement but now it's up to Congress and that may prove difficult because the extension would increase the debt by at least $160 billion. As the AP reports, these aren't unsubstantial policy decisions. "The 2 percent payroll tax cut expiring in December gave 121 million families a tax cut averaging $934 last year at a total cost of about $120 billion, according to the Tax Policy Center ... Letting extended jobless assistance expire would mean that more than 6 million people would lose benefits averaging $296 a week next year, with 1.8 million cut off within a month."