The Fiscal Cliff Sequel - By Gordon Adams

"Our revels now are ended. These our actors, as I foretold you, were all spirits, and are melted into air, into thin air." Prospero, The Tempest, Act IV, Scene 1

The curtain has closed on the shadow play "The Fiscal Cliff." The actors have left and the journalists are sweeping the stage. As foretold in August 2011 it was theater, not a reality show, and certainly not reality itself. But gird your loins for the next round; the fight is far from over.

The endgame drama was a tax bill, not a spending bill, and certainly not a Grand Bargain. It did not affect spending very much at all, as nearly two-thirds of the Republican members of the House pointed out yesterday in voting against the deal.

Because it deferred virtually all of the spending issues, it opened up the opportunity for a new theatrical performance to come to town, one everybody will recognize: "The Debt Ceiling: The Sequel."

We will get to fight the sequester fight all over again in the next two months, without the tax issues to balance it out. Senator Lindsey Graham, already on the record for saying (wrongly) that the Pentagon might have to send out 800,000 layoff notices if the Pentagon budget were hit by sequester, has already advertised that his party should "save your powder for the debt ceiling fight."

But this is not going to be the same kind of fight. The markets are not going to bounce up and down about the spending issue, not in the ecstatic way they bounded up today.  The economic consequences of billions of dollars in added taxes are not the same as the consequences of spending cuts this year ($109 billion) that are less than 1 percent of overall federal spending.

Budgets and spending are familiar year-by-year struggles for Congress. Because negotiators could not get even close to a spending agreement last month, they pushed this fight to March -- about the same time that Secretary Geithner has said that the United States will hit the debt ceiling after his ability to shuffle funds around to avoid going over the top will run out of steam. So the same two trains -- spending and the debt ceiling -- are heading toward each other as they were in the summer of 2011.

What does this mean for federal spending and, my beat, for defense? Not much. Defense is still a side show, a "residual" in a larger agreement.

This week's deal postponed the Budget Control Act's spending sequester for two months, which meant some of the savings that were supposed to happen between January 2 and March 1 -- about $24 billion -- needed to be covered in some way. The deal agreed to apply some of the revenues from the tax changes to cover some of that spending gap.