The House of Representatives voted to pass a bill averting the fiscal cliff late Tuesday night.
"In the final moments of 2012 the action moved from the House which had rejected their own Speaker’s Plan B to raise taxes a little on family’s making over a million dollars to the Senate where more moderate Republicans worried their party would be blamed for the nation 'going over the fiscal cliff,'" said Steffen Schmidt, university professor of political science, in an email.
"This whole crisis was about the expiration of temporary tax cuts enacted by the Bush administration. This would have led to tax increases on all Americans, even working and middle class taxes," Schmidt said. "There would also have been 'sequestration' of funds for all kinds of programs – basically budget cuts – of about 10 percent across the board.
"That would have led to massive layoffs of federal and state employees, including the military. The results would have been a terrible shock to the national economy with a certain recession."
The Senate passed the bill, where it then returned to the House. At 2 a.m., the bill passed with a 257-167 vote.
The bill, which was a compromise between the wants of both Republicans and Democrats, will raise taxes on families making more than $450,000 and individuals making more than $400,000.
Tax cuts will remain the same for the rest of Americans.
Though there are many aspects to the bill, when it comes to students the most important part may be the renewal of child care, tuition, and research and development tax credits.
"The fix to the fiscal cliff crisis is only a Band-Aid," Schmidt said. "The 'major surgery' still has to be scheduled, and that will make the current crisis look like a paper cut."