Skip to comments.Democrats prepare tax-cut bills in case nation goes over 'fiscal cliff'
Posted on 12/30/2012 7:09:34 AM PST by Libloather
Leading Democrats are putting together fallback proposals if Washington fails to reach a deal on the fiscal cliff that would allow the party to cast itself as seeking to cut taxes.
Of course, Ive got a backup plan in the event that we dont succeed here, Sen. Max Baucus (D-Mont.), chairman of the Senate Finance Committee, said Friday. Im sure the White House has one too.
Tax rates are set to expire on most households in January if Congress does not act to extend some of the rates, something some Democrats have long seen as giving their party an advantage. Once the nation goes over the fiscal cliff, pressure would build on Congress to approve lower rates for taxpayers, most of whom make much less than $250,000 per year.
Baucus did not provide details on his post-cliff plan, and emphasized that he believes that Congress should find a way to avoid the fiscal cliff before it arrives.
After meeting with President at the White House on Friday, Senate Majority Leader Harry Reid (D-Nev.) and Republican Leader Mitch McConnell (Ky.) are working on a fiscal deal. They plan to show it to colleagues Sunday.
However, the Montana Democrat acknowledged that there may be some advantages that emerge after a cliff dive that could help usher in a deal.
Thats when the pressure really beings to mount, after the first of the year, he said. Some argue it would be easier to do it next year because the pressures greater. My view is that we should live up to our responsibilities.
A common theory is that it would be easier to convince Republicans to vote for a legislative package after the fiscal cliff hits, since it would then entail voting for a tax cut as opposed to choosing which lower rates would be allowed to expire. Sen. Patty Murray (D-Wash.) made such an argument this summer, well before fiscal cliff talks began in earnest.
Sen. Sherrod Brown (D-Ohio) said he believed going over the cliff would put pressure on both sides, but that Democrats would enjoy public support in their efforts to avoid major cuts to entitlement programs.
I think the public sees even more clearly that the path is not that complicated, he said. Ask the wealthy to pay a little bit more, making fair cuts everywhere. The public doesnt want to see us go after Social Security and Medicare.
Republicans have been more mum on whether they have some fallback tax plan in the works if the nation goes over the cliff, and have instead trained their focus on the next fiscal standoff: raising the debt ceiling.
Sen. Charles Grassley (R-Iowa) told The Hill that the debt limit is a vital negotiating tool for the GOP in its hunt for spending concessions.
The whole business of the debt ceiling thats the leverage weve got, he said. See, all of the debates since the election until today, including today, have been about tax increases weve got to start talking about spending too much.
Treasury Secretary Timothy Geithner told Congress Wednesday that the government will reach its $16.4 trillion borrowing cap on Dec. 31, and the limit will need to be raised sometime in the next few weeks. Multiple GOP lawmakers indicated that their goal now is to get through the fiscal cliff standoff one way or another, at which point Republicans can regroup and focus their efforts on extracting concessions from the White House in exchange for a debt-limit boost.
Give the president whatever he wants [on taxes], Grassley said hypothetically. All it covers is somewhere between eight and 12 percent of the $1.1 trillion deficit.
When you get beyond this fiscal cliff deal, the public starts looking at what were trying to do to cut down on spending as opposed to increasing taxes, that strengthens our hand, he added.
A House GOP aide said the debt limit provides a natural venue for Republicans to continue to push for preferred fiscal policies, once the fiscal cliff is in the rearview mirror.
A spokeswoman for House Ways and Means Committee Chairman Dave Camp (R-Mich.) said Friday that if 2013 arrives with no fiscal cliff deal in place, the plan from House Republicans will be to continue pushing the Senate to take up two bills already approved by the House. One bill would have extended all of the Bush tax cuts, while the other would have replaced military spending cuts with other cuts to mandatory spending and are viewed as nonstarters by Democrats.
The House has acted to avert the entire fiscal cliff, both the January 1 tax hikes and the sequester. Our efforts to enact those goals will continue if there is no agreement prior to January 1," the spokeswoman said.
A spokesman for Senate Minority Leader Mitch McConnell (R-Ky.) also pointed to that legislation when asked about potential contingency plans.
With a fiscal cliff deal still very much in doubt, Sens. Lamar Alexander (R-Tenn.) and Bob Corker (R-Tenn.) unveiled a new proposal Friday that would slow entitlement spending by nearly $1 trillion in exchange for a equally sized increase to the debt limit.
The pair said the outcome of fiscal cliff negotiations is apparent in broad strokes policymakers will strike some deal to avert tax hikes on most Americans, while allowing them to rise for some portion of top earners.
For almost all Americans, when the dust settles, individual income taxes wont be going up next year, said Alexander.
We know that thats going to be the outcome, added Corker. But we hope that then we will turn to the serious business of reforming our entitlements.
Unfortunately for America, the next line in the sand is going to be the debt ceiling, he said.
Exactly! I thought taxes were good. In fact, it’s the only way to prosperity.
You can’t fix retarded.
And of course, with the aid of the media, the Republicans will look like crap and the Democrats will be golden because they came up with plan even though it’s what (some) Republicans have been asking for.
Thesis, anti-thesis, synthesis. Not to worry. Socialists have the solution to the socialist-induced fiasco.
We are soooooooooooo screwed!
These asshats couldn’t find their butts with two hands.
The corruption is so deep on BOTH sides of the aisle that they will never come to any agreement that will be for the good of the Republic.
It’s all about them. It’s all about getting re-elected. It’s all about taking care of your pals. Both sides are more than guilty of this.
The only chance we have is to start from the ground up, with local elections, governors especially, to get the states to flip these clowns off!
...I know, take out the umbrellas for the flying pig poop...but...it can happen—I sure as heck hope it does at any rate.
They help Obama DESTROY the country and then want to turn around and use CONSERVATIVE ideas like Bush did to restore what they destroy.
Do everything you can to cause the problem, blame it on the other party, and then take credit for stepping in to save the day. Gotta give it to the Dems, they’re devious and they play to win while Pubbies sit and watch in the grandstands happy to have seats near the playing field.
Listening to ABC Radio News the other day driving in to work, they phrased it to sound like the Democrats were the ones fighting to keep the evil Republicans from raising middle class taxes.
All of this “over the cliff” garbage is just that.
The Republicans caved in weeks ago and are waiting until the very list hour to finally make it public so that it will look like they fought almost to the death to capitulate to the enemy (Democrats).
In that way, they can say they did the best they could.
I expect the “breakthrough..(ie. “cave in”) to occur about 11 pm on the final day before the cliff is reached.
The only problem is they will add so much spending and other Freedom-squashing crap to their "tax cut" bills that the Repubs will have to either say no (and get blamed for keeping the burden upon us) or sell us down the road - any bets on how it plays out?
“I thought taxes were good. In fact, its the only way to prosperity.”
It’s true. I head and read it in our mainstream media. If they said it the Democrats must be right. /sarc
The problem is SPENDING. Tax cuts will increase revenue but it won't make any difference if they are blowing it out the other side.
Pretty sad when even the French get it and we don’t.
Last = list
The media just gets its talking points from the White Hut press office, puts their byline on it and moves the blather to the public waiting for their daily dose of BS.
We used to laugh at the crap given out by the gov in N Korea. We long surpassed them. There is almost nil actual reporting going on these days.
Meanwhile, I note the French, of all places, just had their ridicules millionaires tax over turned in their courts due to “being unequal” in its application. How is ours equal when it is not?
ABC Radio News
Arugably the worst liberal propaganda outlet out there. They are very devious in how they SHAPE the “news”.
Sometimes I can’t believe that my car radio still works.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.