The irony is that the financial community doesn’t actually require too heavy of a lift from lawmakers. Wall Street doesn’t care if D.C. policymakers forego the elusive “grand bargain” this time around, nor do they harp on overhauling of entitlements programs in the short run. They don’t care if Republicans cave on raising tax rates, or Democrats uphold their principles of preserving the social safety net—as long as there is some type of plan so that people know their tax rates for 2013 and so that businesses can plan for profit margins.
“People just want to avoid the disaster scenario and get enough of a deal to avoid the really bad outcome,” Feinman says. “The immediate problem has not been that the deficit is too big. It’s that the economy is not strong enough. Let’s not lose sight of the ball: The economy needs to be stronger.”
The most important aspect of a fiscal-cliff deal, to the New York financial community, is to take any fiscal drag out of the equation by undoing across-the-board spending cuts and by ensuring that huge swaths of people’s taxes don’t go up. Some additional economic stimulus would not hurt either, West says, to continue to boost the economy.