Over the past few weeks, much of the world has been caught up in the heated debate over the so-called “fiscal cliff” that the United States is facing.

But what exactly is this terrifying cliff? In the most succinct terms, it is a combination of budget cuts and tax hikes. Thousands of pages have already been written — and will continue to be written — about how the world’s largest economy can and should work its way out of this crisis. Options include allowing scheduled tax increases to go into effect and cutting expenditures by $600 billion, steps that are likely to drag the US into another recession.

But it’s not just the United States that is facing a fiscal cliff. So is the Israeli economy, even though the precipice that it faces is significantly smaller. After all, proportions are everything. In other words, let’s borrow from geography and imagine that this cliff is a real geographic landmark. In the US it would be as high as the Rocky Mountains, while in Israel it isn’t much higher than Mount Hermon (the country’s highest mountain). And yet, while it is considerably less steep, it can still cause considerable pain. The bad news is that tackling this issue will hurt each and every one of us in our pockets. The somewhat less-bad news is that it doesn’t look like we’ll fall flat on our faces.

In Israel, just like in the US, there are two sides to this problem: revenue and spending. This is not the place for some long, exhaustive discourse on economics. All we really need to know is that the two are not directly connected. In other words, anyone who thinks that if we resolve the revenue problem, we will not have to deal with the expenditure problem is wrong, and vice versa.