Is The 'Fiscal Cliff' Overshadowing The Real Economic Crisis?

"Fiscal cliff" negotiations reached yet another standoff Tuesday between President Obama and House Speaker John Boehner.

The president's latest offer includes preserving tax cuts for Americans who earn less than $400,000. On Wednesday, Obama encouraged his "Republican friends" to "take the deal."

The president then added, "But they keep on finding ways to say no, as opposed to finding ways to say yes. And I don't know how much of that just has to do with it's just very hard for them to just say yes to me."

Down the Mall in Capitol Hill, Boehner practically sprinted to the microphone to assure the president that it's not personal, it's politics.

"And I hope the president will get serious soon," Boehner said, "about providing and working with us on a balanced approach."

The House will vote Tuesday on Boehner's so-called "Plan B", an offer that preserves tax cuts for all households with incomes below $1 million, instead of Obama's cap of $400,000. The president could take that deal, Boehner said, or "he can be responsible for the largest tax increase in American history."

If you're getting fed up with the negotiations, so is Boston University economist Lawrence Kotlikoff.

He says the political theater surrounding the fiscal cliff is overshadowing what he believes is the true crisis: the massive funding gap for Social Security and Medicare. Kotlikoff called the entitlement programs a "Ponzi scheme."

In response, Kotlikoff has put together The Purple Plans, a nonpartisan, economics-driven approach to entitlement reform. Five Nobel Prize winners have endorsed the plan.

Kotlikoff described his fix in detail to Radio Boston and why he believes the current fiscal cliff is a "manufactured crisis".

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