NEW YORK CITY-As the US economy inches closer to January 1, so comes yet another doomsday scare . . . This one the so-called fiscal cliff, the ominous package of tax increases and spending cuts tied to a corresponding reduction in the budget deficit. But is it a harbinger of economic calamity, or will a deal be forged to avoid it? Some observers are optimistic about a pre-precipice deal while others are more skeptical.

“They’ll solve it and there won’t be a fiscal cliff,” says Joel Ross, principal at Citadel Realty Advisors. “You can’t have it happen and everyone knows it. At the end of the day if they really do go over the cliff, everyone in Washington gets obliterated. The voters will go nuts. Europe will go nuts. It will not happen.” Negotiators won’t be starting from scratch.

Ross says behind-the-scenes negotiations have been pursued over the past several months between the business community, Wall Street and the Obama Administration having laid the groundwork for possible deals that may take on some aspects of the Simpson-Bowles plan to deal with the national debt. Ross says Democrats and Republicans know what needs to be done, but it’s a matter of hammering out a deal in such a way that all involved can save face.