There was short-term optimism about the U.S. economy after the fiscal cliff deal, but there's still a looming problem for this year that can't be avoided: automatic spending cuts to government programs.
Because Congress did not reach an agreement on them, the automatic spending cuts - known as sequestration - are now delayed until March. Lawmakers will meet in March to try and restructure the cuts.
As of now, the cuts equal $1.2 trillion in savings over 10 years. If nothing is done, there will be across-the-board preprogrammed reductions in a number of government programs, with the defense industry being hit the hardest with $55 billion.
For lawmakers wielding the knife, deciding where to slash budgets is tricky. If there are too many reduction-related layoffs, the automatic cuts could kick the nation back to a recession.
Here's a breakdown of what will be cut if Washington does nothing and lets the sequester go through as planned.