Over "fiscal cliff," fiscal pain to accelerate On Friday, Jan. 4, middle-class Americans who get paid that day would see take-home pay decline by an average of about $25, according to calculations based on data from the nonpartisan Tax Policy Center. That's the effect of higher taxes on just under one week of pay in a bimonthly check. In wealthy areas such as Washington, the average tax hike for someone earning more than $100,000 would be roughly $130, reflecting higher taxes on nearly one week of pay. The tax hikes would result from the expiration of the payroll tax holiday, which has been in effect for two years, and the George W. Bush tax cuts, which have been in effect for a decade. The impact in the first week would be modest. The following weeks would be much uglier. "It's going to be a gradually increasing wave of anxiety that's going to go over people day by day in January," said Steve Bell, senior director of economic policy at the Bipartisan Policy Center and a former senior member of the Senate budget staff. In the second week of January, about 2 million jobless Americans who have been relying on federal unemployment insurance would stop receiving checks. This would probably have an immediate effect on the overall economy. People receiving unemployment benefits usually spend almost all the money on necessities such as food, toilet paper and toothpaste, economists say. Then, on Friday, Jan. 11, Americans who get paid that day would take an even steeper hit. The average middle-class employee, having worked nearly two weeks in 2013, would see the take-home pay in their bimonthly check decline by about $60, according to the Tax Policy Center. For two full weeks, the figure would be about $65. Wealthier Americans could see their take-home pay fall by an average of $290. Over the following weeks, the initial distress would build into something even worse. Financial markets could be in panic. But even if they're not, this is how the fiscal cliff turns into fiscal chaos. If an agreement continues to elude the White House and lawmakers, doctors who accept Medicare, the health insurance program for the elderly, will see their reimbursement rates automatically slashed. As April 15 approached, millions in the middle class would be on the hook for taxes they didn't know they would have to pay. Federal agencies may have to furlough workers. And the federal government could run out of money, potentially defaulting on the national debt. This seems an unlikely scenario. But after a month of fitful talks, Obama and congressional Republicans have been unable to reach an agreement. House Speaker John A. Boehner (R-Ohio) gave the negotiations a boost late last week when he agreed to raising tax rates on millionaires in exchange for deep cuts in entitlement programs such as Medicare. Despite newfound optimism among some involved in the negotiations, time is fast running out to avoid the cliff - and a blow to the economy that could knock it back into recession.