Fiscal Cliff Notes for Dec. 18, 2012
13 days to the fiscal cliff
BREAKING NEWS: WHILE SOME PROGRESS WITH WHITE HOUSE, GOP HOUSE DEVELOPING BACKUP PLAN
House Speaker John Boehner (R-Ohio) is developing a Plan "B" to avoid taxes rising for everyone if Congress does not make a deal by Dec. 31.
President Barack Obama has budged and reportedly is open to having tax rates rise for those with incomes over $400,000--up from the $250,000 he has been talking about. But the GOP and the White House are not in agreement on the balance between raising revenue and cutting spending. Boehner has moved to letting taxes rise for those with income of $1 million and above.
From Boehner spokesman Michael Steel: "Any movement away from the unrealistic offers the President has made previously is a step in the right direction, but a proposal that includes $1.3 trillion in revenue for only $930 billion in spending cuts cannot be considered balanced. We hope to continue discussions with the President so we can reach an agreement that is truly balanced and begins to solve our spending problem."
BOEHNER'S BACKUP PLAN
On Tuesday morning, Boehner is huddling with his Republican House members and will, I am told, "announce that - given the short time before America goes over the 'fiscal cliff' and the White House failure, thus far, to produce a balanced offer - the House will open up a second track and begin work on a 'Plan B' to stop most of the tax hikes on the American people scheduled for January 1.
"The Speaker will continue to work with the president on a broader agreement as he told the president last night in a phone call, but with time running short the House will act as a precautionary measure to ensure taxes don't rise for most Americans on January 1.
"The threat of all current tax rates expiring is too great to not have a backup plan. We're still talking to the White House and are hopeful an agreement will be achieved, but the President must be willing to support a truly balanced approach - his current offer includes $1.3T in revenue and only $850B in net spending cuts."
HERE IS WHAT BOEHNER IS PLANNING TO SAY TO HIS MEMBERS
Excerpt: "Current law has tax rates going up on everyone January 1. The question for us is real simple: How do we stop as many of those rate hikes as possible? And can we ensure the president keeps his promise to the American people to make real spending cuts along with it that will actually address the problem of our debt?
"For weeks, Senate Republicans -- and a growing number of you -- have been pushing for us to pivot to a "Plan B." I think there's a better way. But the White House just can't seem to bring itself to agree to a "balanced" approach, and time is running short. Taxes are going up on EVERYONE on January 1. They're baked into current law. And we have to stop whatever tax rate increases we can. In the absence of an alternative, as of this morning, a "modified Plan B" is the plan.
"At the same time we're moving on "Plan B," we're leaving the door wide open for something better. And I have been clear about that with the president. Plan B is Plan B for a reason. It's a less-than-ideal outcome. I've always believed we can do better.
"During the campaign, the president promised the American people a "balanced" approach to the debt - revenues and spending cuts. And what I offered the president is the definition of balance: a trillion in revenue, and a trillion in spending cuts. Instead of letting tax rates rise on Americans making $250,000 or more, the rates would rise only on those making a million and up. Instead of getting zero spending cuts, we'd get a trillion in spending cuts, mostly from entitlement programs. Most importantly, we'd lock in a process for tax reform and entitlement reform in 2013 - the two big goals we've talked about for years.
"The president hasn't been able to get there. He talked about a "balanced" approach on the campaign trail. What the White House offered yesterday -- $1.3 trillion in revenue for only $850 billion in spending cuts -- cannot be considered balanced. We're going to keep the door open in hopes the president can find a way to support a balanced approach."
NEW POLL: PEOPLE WANT DEAL, DON'T LIKE FISCAL CLIFF OPTIONS
From the Washington Post-ABC News: "Most Americans want President Obama and congressional Republicans to compromise on a budget agreement, though they, too, are unhappy about the options that would avert the "fiscal cliff," according to a new Washington Post-ABC News poll. For more, click HERE.