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Senate Majority Leader Harry Reid (D- NV) is probably the largest obstructionist in Washington DC these days. What is funny, however, is when he obstructs President Obama.
As we all know, President Obama made a proposal, correctly called unserious, for avoiding the looming fiscal cliff. The plan was basically soak the rich and maybe, possibly, well cut some loosely defined spending a decade down the line. That proposal would not, obviously, have solved anything. But it would have made the far left base of the Democratic party, people who just adore socialism and believe there is always more of someone elses money to spend, very happy.
If a Senate deal to avert the fiscal cliff becomes law, all but a sliver of the U.S. population will avoid higher tax rates, some key issues will be put off for two months, and all sides in the battle will emerge with a mixed record: winning key points, while ceding ground on others. The deal, which passed the Democratic-controlled Senate in an overwhelming 89-8 vote in the early hours of Tuesday, would maintain tax cuts for individuals earning less than $400,000 and couples earning less than $450,000. Technically, it would reinstate cuts that expired at midnight.
It would raise tax rates for those over those levels -- marking the first time in two decades the rates jump for the wealthiest Americans. The bill faces an uncertain future in the Republican-controlled House where GOP members gathered Tuesday afternoon. "The purpose of this meeting is to review what the Senate has passed, discuss potential options, and seek member feedback. No decision on the path forward is expected before another member meeting that will be held later today," one GOP leadership aide said. Vice President Joe Biden, meanwhile, met with House Democrats. A longtime senator, he helped broker the Senate deal.
The House faces a deadline. On Thursday at noon, a new Congress will be sworn in. A bill passed by the previous Senate would no longer apply, so both chambers would have to start from scratch. Some Republican lawmakers, including Reps. Phil Gingrey of Georgia and Tim Huelskamp of Kansas, told CNN they would not support the bill as written. "It's taxing, and still taxing, small businessmen and women, and I don't like that at all," Gingrey said, referring to some small business owners who would be among those whose tax rates rise.
It's the opposite argument of some Democrats who oppose the bill. Sen. Tom Harkin, D-Iowa, complained that the deal "makes tax benefits for high-income earners permanent, while tax benefits designed to help those of modest means and the middle class are only extended for five years." The bill temporarily extends certain tax breaks, such as the one for college tuition, while making new tax rates permanent.
More It's up to the House: fiscal cliff faces Republican-controlled territory - CNN.com
Republican leaders in the House said they might try to change the bill approved by the Senate which voted to raise taxes on the wealthy in a late-night show of unity. That would set up a high-stakes game of chicken between the two chambers and risk a stinging rebuke from financial markets that are due to open in Asia in six hours. The bill drew overwhelming support from Republicans and Democrats alike in the Senate when it passed by a vote of 89 to 8. But Majority Leader Eric Cantor, the No. 2 Republican in the House, told reporters after huddling with other Republicans that he does not support the measure.
Republicans said they might try to add more spending cuts to the bill, which contains over $600 billion in tax increases but only around $12 billion in spending cuts. With the Senate adjourned until Thursday, it appeared possible that Congress could push the country over the "fiscal cliff" after all, despite months of effort. Republicans could face a backlash if they scuttle the deal. Income tax rates technically rose back to 1990s levels for all Americans at midnight, and across-the-board spending cuts on defense and domestic programs are due to kick in on Wednesday.
Economists say the $600 billion combination of tax cuts and spending cuts could push the economy into recession, and public opinion polls show Republicans would shoulder the blame. Lingering uncertainty over U.S. fiscal policy has unnerved investors and depressed business activity for months. Financial markets have staved off a steep plunge on the assumption that Washington would ultimately avoid pushing the country off the fiscal cliff into a recession.
With financial markets closed for the New Year's Day holiday, lawmakers have only Tuesday to close the deal before Wall Street has time to weigh in. "My district cannot afford to wait a few days and have the stock market go down 300 points tomorrow if we don't get together and do something," Representative Steve Cohen, a Democrat from Tennessee, said on the House floor.
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