President Obama has advised Democrats not to buy any nonrefundable plane tickets before the end of the year, and House leaders have told their members that they may not be home for Christmas.
Taken together, it appears that Congress will push the “fiscal cliff” talks all the way — and possibly pass — the Jan. 1 date when tax rates will rise across the board, and the following day when mandatory spending cuts, known as sequesters, kick in.
“I don’t put good odds on us getting it done before Christmas,” said Rep. Chris Van Hollen, Maryland Democrat and ranking member on the House Budget Committee. “I think it is less than 50 percent before Christmas. I think it is better than 50 percent before the end of the year. But, all of us know, there is just a lot of uncertainty here.”
Since returning to Washington a month ago for the postelection lame-duck session, Democrats and Republicans have locked horns over how to handle the expiring Bush-era tax cuts and the $110 billion in looming cuts to defense and domestic spending that were included in the deal lawmakers reached last year to raise the nation’s borrowing limit.
Both sides agree that the parameters of a fiscal-cliff deal should involve a combination of new revenue and spending cuts, but they disagree over what ratio of spending cuts to revenue increases would put the nation on a solid fiscal footing moving forward.
Mr. Obama and Democrats are pushing to raise $960 billion over ten years by letting the 2001 and 2003 tax cuts expire for individuals making more than $200,000 a year and families making more than $250,000 a year.
Republicans, meanwhile, are pushing for an across the board extension of the 2001 and 2003 tax cuts.
Last month, Mr. Obama delivered the opening bid in the broader “fiscal cliff” talks, calling for an additional $600 billion to be raised by eliminating loopholes in the federal tax code that benefit the nation’s top earners.
The plan called for $600 billion in assorted “savings” over 10 years, and $50 billion in new spending on infrastructure projects.
Mr. Obama also has called for an extension of the 2 percent payroll-tax holiday and stretching unemployment benefits through 2013.
House Republicans responded with a counteroffer that called for $800 billion in new tax dollars to be raised through revising the tax code. They also called for $1.4 trillion in savings from entitlement and discretionary programs, as well as embracing a lower inflation measure to calculate future Social Security benefits.
This week, the two sides have been negotiating behind closed doors and trading rhetorical blows in public.
House Speaker John A. Boehner, Ohio Republican, said Wednesday that Mr. Obama’s plan relies too heavily on tax increases and does not do enough to tackle the national debt, which now stands at $16.3 trillion.
“You know, the longer the White House slow-walks this discussion, the closer our economy gets to the fiscal cliff — and the more American jobs are placed in jeopardy,” he said.
House Majority Leader Eric Cantor, Virginia Republican, added some more bad news, warning that lawmakers might have to put their holiday plans on pause.View Entire Story
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