Over the Fiscal Cliff: What the First Month Looks Like By Michael Crowley The last time people were this nervous about the approach of the New Year, it was 1999 and the Y2K bug threatened to put the world's computers on the fritz. This year, with President Obama and Republicans in Congress struggling to agree on a long-term debt-reduction plan, the U.S. may go over the fiscal cliff on Jan. 1, when a range of automatic tax hikes and spending cuts totaling more than $600 billion, or 4% of GDP, kick in all at once. Despite the dramatic metaphor, it's not a straight plunge. The cliff's slope is more forgiving: the cuts can be managed at first but will accelerate over time. Obama and the GOP might still cut a deal after the clock strikes midnight on Dec. 31, but the danger of lasting damage to the economy grows by the day. Here's how things might play out in January. Hover over calendar to zoom in.