Wednesday, December 19, 2012

Not Over The Cliff Yet!

So while we were trained on the tragedy at Newtown, Conneticut....which just broke all of our hearts...Apparently the hearts of some Republicans have warmed a bit to the idea that the wealthy should pay their fair share of the nation's tax burden....

President Obama's White House and  House Speaker John Boehner now appear closer to a deal than ever before. (Imagine that!)The only questions remaining are whether both sides can resolve their remaining differences and, more importantly, can sell the deal to their respective rank-and-files. (Easier said than done!)

After House Speaker Boehner made an offer on Friday to raise rates on income above $1 million, President Obama yesterday presented the speaker with a counterproposal consisting of $1.2 trillion in revenue (which includes the Bush-era tax cuts expiring for income above $400,000) and $1.2 trillion in spending cuts (including $800 billion in health and non-health programs, $290 billion in interest, and $130 billion in changing the cost-of-living adjustment for Social Security benefits).

The White House’s offer also extends unemployment insurance, raises the debt ceiling for two years, and includes funds for infrastructure.House Speaker Boehner’s office released a statement calling the White House’s counteroffer “a step in the right direction,” per NBC’s Frank Thorp. But it doesn’t want to count the interest as part of the spending cuts. Yet he fact the White House is agreeing to the Boehner principle of 1-to-1 revenue increases vs. spending cuts on this deal means it’s now about exchanging numbers, potentially dotting “I”s and crossing “T”s. Good people, while this is a bit of progress -- but we’re not there yet.

Check it out-Both sides are $200 billion apart on tax revenue ($1.2 trillion vs. $1 trillion), apart on the income cut-off for tax rates going up ($400K vs. $1 million), apart on whether you include interest as part of the spending cuts (Republicans believe the White House has actually only proposed a net of approximately $850 billion in spending cuts compared to $1.2 trillion in tax hikes), and apart on the debt-ceiling increase (one year vs. two years).

 If you simply split the difference, you could have a final deal of $1.1 trillion in revenue, $1.1 trillion in spending cuts, and $600K to $700K on the income cut-off. The things to watch today: 1) How both sides’ rank-and-file members receive these numbers, and 2) if the momentum for a deal continues. As one Dem congressional aide tells First Read, “Momentum breeds momentum.”

A Senate leadership aide adds that the potential “Plan B”s circulating among GOPers are being held off until Thursday. So House Speaker Boehner and the White House have until then, realistically.

So time is now of the essence. If you want to do something before Dec. 31, the clock is ticking. By the way, House GOP leaders (Boehner, Eric Cantor, Kevin McCarthy, Cathy McMorris Rodgers, Lynn Jenkins) are holding a stakeout at 10:00 am ET.

So how are Liberal and Progressive thinkers and their conservative counterparts reacting to all of this???

From the liberal and progressive side, here is the headline banner of today’s Huffington Post: “Raw Deal: Obama’s latest fiscal cliff offer targets middle class, elderly.” From the story: “Obama's offer would allow the payroll tax holiday to expire, meaning middle class workers will see smaller paychecks in 2013.” (Though wasn’t the payroll tax cut supposed to be temporary?)

Meanwhile, the New York Times’ Paul Krugman is taking a wait-and-see approach. “Those cuts [CPI adjustment for Social Security] are a very bad thing, although there will supposedly be some protection for low-income seniors. But the cuts are not nearly as bad as raising the Medicare age.” And yesterday, on the conservative side, we saw the right wing think tank,Heritage Action blast House Speaker Boehner’s offer to let the Bush-era tax cuts expire on income over $1 million, and Club for Growth urge Republicans not to concede on the debt ceiling. The way you used to be able to get a deal in Washington is if both sides complained -- that meant there was equal pain. The question is if that still applies today.

I expected that there was going to be some pain in order to avoid this fiscal cliff.. I don't honestly know if I like some of the compromises that might have to be made...But since it's been so long since Congress and The President have compromised on anything...I suppose some pain is better than the enormus pain that would have or could have occurred if we went over this fiscal cliff.

I'm looking ahead to 2014...To get Mitch McConnell and the rest of the Tea Party out of Congress  completely.....Then maybe some real progress can be made... At best, this is just an early Christmas gift...You know ...the kind you open and realize, although it's not what you wanted...It is better than the pair of socks that you got the year before..

1 comment:

Arlene said...

Keith, I say pad your bottom because we're going off the cliff! I don't believe that the spending cuts required by the republicans should stand. America voted for President Obama who said raise taxes on the wealthy. That is what should happen. The poor have nothing to start and the middle class has already "given." Our vote said the rich should pay more!! If we have to jump, then let's jump!!


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