December 30, 2012

'Fiscal cliff' deal: Taxes key as private budget talks start

At the center of the negotiations is the question of which Bush-era cuts to extend.


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Harry Reid, Nancy Pelosi, Mitch McConnell, John Boehner
click image to enlarge

In a combination of photos, congressional leaders Harry Reid, D-Nev., Nancy Pelosi, D-Calif., Mitch McConnell, R-Ky., and John Boehner, R-Ohio, leave the White House separately Friday following a closed-door meeting with President Obama in an effort to avert the fiscal cliff. Reid, the Senate majority leader, and McConnell, the Senate minority leader, were racing Saturday to forge a deal in time for votes Sunday night by both houses of Congress.

The Associated Press


Failure to reach agreement by the end of the year Monday evening would mean:

All Bush-era tax cuts would expire for all taxpayers.

An Obama cut in the payroll tax for Social Security would expire.

Jobless benefits would dry up for 2 million unemployed.

The alternative minimum tax would hit more taxpayers.

Medicare payments to doctors would be cut.

$109 billion in federal government spending cuts would start, the first installment toward $1.2 trillion in cuts over two years.

Republicans, in their radio address rebuttal, said they agree with Obama about sparing millions of Americans from economic hardship. They just disagree with some of the ways to do it.

“The president’s proposal to raise taxes on the top 2 percent of Americans won’t even pay one-third of the annual interest that’s now owed on this massive $16 trillion debt,” Sen. Roy Blunt, R-Mo., vice chair of the Senate Republican Conference, said in his party’s radio message.

“We still can avoid going over the fiscal cliff if the president and the Democrat-controlled Senate step forward this week and work with Republicans to solve this problem and solve it now.”

Blunt suggested that Senate negotiators already have a blueprint to work with to avoid the fiscal cliff in legislation passed earlier this year by the Republican-controlled House, including an August vote to extend President George W. Bush-era tax cuts for all incomes for one year.

“The House has already passed bills to protect all Americans from burdensome tax increases,” Blunt said. “But instead of working across the aisle and considering the House-passed plan to protect taxpayers, Senate Democrats have spent months drawing partisan lines in the sand.”

To keep pressure on Congress, Obama will sit for an interview with NBC’s “Meet the Press.” It is his 11th appearance on the show but only his second as president. His last appearance was in September 2009 during the battle over revamping the nation’s health-care system.

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