White House, Republicans Seal Deal On Fiscal Cliff

[webfact]

White House, Republicans seal deal on fiscal cliff

By Stephen Collinson and Michael Mathes (AFP)

WASHINGTON — The White House and top Republicans struck a deal to avert huge New Year tax hikes and spending cuts known as the "fiscal cliff" that had threatened to send the US economy into recession.

The pact would raise taxes on the richest Americans -- those earning over $450,000 a year -- but exempt everyone else, and will put off $109 billion in budget cuts across the government for two months, top congressional aides said.

Vice President Joe Biden, who negotiated the deal with Republican Senate Majority leader Mitch McConnell, was on Capitol Hill to sell it to Democratic senators, a White House source added.

Tax hikes and spending cuts were due to come into force on January 1. But as global markets, sure to be rocked by a failure to head off the fiscal cliff, are closed for New Year's day, lawmakers have time to vote the deal into law.

A Senate vote was expected overnight on Monday while the House of Representatives was expected to follow suit on Tuesday after a display of dramatic New Year's Eve brinkmanship.

The deal would mean a return to Bill Clinton-era tax rates for top earners to 39.6 percent, starting at a threshold of annual household earnings of $450,000 and above.

Obama had originally campaigned for tax hikes to kick in for those making $250,000 and above and his acceptance of a higher threshold has already angered liberals, though still represents a political victory.

The president said it would extend tax credits for clean energy firms and also unemployment insurance for two million people due to expire later Monday.

It was also expected to include an end to a temporary two percent cut to payroll taxes for Social Security retirement savings and Medicare health care programs for seniors and changes to inheritance and investment taxes.

The president angered Republicans in remarks in which he warned -- in what is certain to be a bitter fight over cutting the deficit -- that he was not done with seeking higher taxes for the rich.

"Now, if Republicans think that I will finish the job of deficit reduction through spending cuts alone... then they've another thing coming," Obama said, and also poked fun at the glacial pace of Congressional deliberations.

Republicans immediately took to the floor of the Senate to complain.

Senator John McCain accused Obama of ridiculing Republicans and of needlessly antagonizing House of Representatives' members required to vote for the deal.

Republican Senator Bob Corker said his heart was pounding with disappointment at Obama's remarks.

"I know the president has fun heckling Congress. I think he lost probably numbers of votes with what he did," he said.

"It's unfortunate he doesn't spend as much time solving problems as he does with campaigns and pep rallies."

Signs that a deal could be close cheered investors Friday as US markets rose before closing for the year. The Dow Jones Industrial Average closed up 166.03 points (1.28 percent) at 13,104.14.

Both sides were Monday already gearing up for the next legislative showdown over the need to lift the government's statutory borrowing limit of $16.4 trillion, which was reached Monday.

The Treasury will now take extraordinary measures to keep the government afloat for an undisclosed period of time until the ceiling is raised. Republicans are already demanding spending cuts in return.

"I think there is going to be a pretty big showdown next time when we go to the debt limit," McCain told CNN.

-- (c) Copyright AFP 2013-01-01

[bushwacker]

They all act like a bunch of spoiled children. The US deserves to crash and burn but unfortunately, they will take the rest of the world with them.

[Hedghog]

Who cares.

Bring on the Chinese.

The sleeping tiger.

[BookMan]

Re: the tax hike. The rich, no matter how rich, rarely want to share their wealth.

It always seems odd to me that the same society that makes them wealthy is the very one they want to minimise their financial contribution towards.

Edited January 1, 2013 by BookMan

[gatorsoft]

Once again the democratically elected president acts like a petulant child gloating over his perceived victory and antagonizing those that he needs to compromise with.

[Suradit69]

needlessly antagonizing House of Representatives' members

As opposed to the usual state of affairs when the House of Representatives needlessly antagonizes the general population.

[puck2]

The problem(s) is(are) not solved, the solution is only delayed.

Edited January 1, 2013 by puck2

[hawker9000]

They all act like a bunch of spoiled children. The US deserves to crash and burn but unfortunately, they will take the rest of the world with them.

Oh my yes. The state of the eurozone certainly shows us a uniquely mature and well ordered economic mindset.

Any excuse for America-bashing. 'Not at all childish (& churlish)...

[chuckd]

Anybody notice the Senate Democratic leaders had little to do with the compromise?

Yeah...I thought not.

Edited January 1, 2013 by chuckd

[geriatrickid]

Who cares.

Bring on the Chinese.

The sleeping tiger.

Sorry, but if I wanted to live in a country with no respect for basic human rights, no rule of law, no democracy, no respect for the environment and as someone considered racially inferior, I'd move back to China.

[geriatrickid]

Anybody notice the Senate Democratic leaders had little to do with the compromise?

Yeah...I thought not.

Well, the Senate democrats were not the ones causing the disagreement. The Republicans were the ones arguing with the POTUS.

[geriatrickid]

Once again the democratically elected president acts like a petulant child gloating over his perceived victory and antagonizing those that he needs to compromise with.

He isn't the one that needs to compromise. He has made enough concessions. Did you forget that the Republicans ran on a platform that rejected everything the POTUS stood for? The Republicans lost the November election and are the ones that do not wish to respect the will of the people. The election victory endorsed the POTUS platform and Obama is the one with the mandate.

[EarthAlien]

They all act like a bunch of spoiled children. The US deserves to crash and burn but unfortunately, they will take the rest of the world with them.

Oh my yes. The state of the eurozone certainly shows us a uniquely mature and well ordered economic mindset.

Any excuse for America-bashing. 'Not at all childish (& churlish)...

"Excuse" you've got to be joking right?

Every currency is pegged to the US dollar standard. The US dollar will inevitably crash and burn as it can't service a $16trillion dollar debt which will continue to blow out right until the death knell rings.

Once the dollar falls the entire international financial system goes into free fall with it.

We "IE.... the rest of the western world which you refer to as US bashers" didn't create the totally calamitous outcomes that now face the US and implicate everyone else.

All governments are evil and that's for sure,.... the fact that US leads the way and has snubbed it's nose at everyone else is justifiably bashing material.

[chuckd]

Anybody notice the Senate Democratic leaders had little to do with the compromise?

Yeah...I thought not.

Well, the Senate democrats were not the ones causing the disagreement. The Republicans were the ones arguing with the POTUS.

The Senate Democrats weren't engaged in the conversation in the first place. They chose to stand aside and not do anything, just as they have done for over 1300 days on passing a budget.

[stoli]

Harry Reid's entire job is just to be a barking dog. He could not, would not, bring anything to the table, or negociate with anyone. He had to replaced by Joe Biden because this old man has given up on his job. This is really a final blow to the Reid legacy. He and Obama both are not business people, and never learned to strike a deal. The Senate Democrats have not passed a budget in years because they don't know how to, or the desire to learn. It could interfere with their spending money like a drunk on Walking Street. Instead they get away with just holding their breath until their faces turn blue. For those that say Obama's re-election was a mandate, 50% of the vote is NOT a mandate.

[chuckd]

After seeing some of the details of this bill, it might have rough sledding in the House.

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FISCAL CLIFF DEAL: $1 IN SPENDING CUTS FOR EVERY $41 IN TAX INCREASES

by MATTHEW BOYLE 31 Dec 2012

According to the Congressional Budget Office, the last-minute fiscal cliff deal reached by congressional leaders and President Barack Obama cuts only $15 billion in spending while increasing tax revenues by $620 billion—a 41:1 ratio of tax increases to spending cuts.

When Presidents Ronald Reagan and George H.W. Bush increased taxes in return for spending cuts—cuts that never ultimately came—they did so at ratios of 1:3 and 1:2.

“In 1982, President Reagan was promised $3 in spending cuts for every $1 in tax hikes,” Americans for Tax Reform says of those two incidents. “The tax hikes went through, but the spending cuts did not materialize. President Reagan later said that signing onto this deal was the biggest mistake of his presidency.

"In 1990, President George H.W. Bush agreed to $2 in spending cuts for every $1 in tax hikes. The tax hikes went through, and we are still paying them today. Not a single penny of the promised spending cuts actually happened.”

http://www.breitbart...ding-cuts-ratio

[gatorsoft]

Once again the democratically elected president acts like a petulant child gloating over his perceived victory and antagonizing those that he needs to compromise with.

He isn't the one that needs to compromise. He has made enough concessions. Did you forget that the Republicans ran on a platform that rejected everything the POTUS stood for? The Republicans lost the November election and are the ones that do not wish to respect the will of the people. The election victory endorsed the POTUS platform and Obama is the one with the mandate.

The republicans represent their electorate. The petulant child made no concessions and really shouldn't be a figure in the debate anyway, it belongs to congress. I suppose when W won the election you were prepared to respect the will of the people and accept without dispute everything that he proposed. Anyone that gives the situation a little thought can recognize the need to reduce spending as part of the solution. Your interpretation of the workings of a representative democracy is questionable at best. I notice that you don't deny that he is acting like a petulant child.

[gatorsoft]

They all act like a bunch of spoiled children. The US deserves to crash and burn but unfortunately, they will take the rest of the world with them.

Oh my yes. The state of the eurozone certainly shows us a uniquely mature and well ordered economic mindset.

Any excuse for America-bashing. 'Not at all childish (& churlish)...

"Excuse" you've got to be joking right?

Every currency is pegged to the US dollar standard. The US dollar will inevitably crash and burn as it can't service a $16trillion dollar debt which will continue to blow out right until the death knell rings.

Once the dollar falls the entire international financial system goes into free fall with it.

We "IE.... the rest of the western world which you refer to as US bashers" didn't create the totally calamitous outcomes that now face the US and implicate everyone else.

All governments are evil and that's for sure,.... the fact that US leads the way and has snubbed it's nose at everyone else is justifiably bashing material.

Hmmm, I wonder why the rest of the world economy depends on the horribly wrong economy of the US. Kind of makes the rest of the world look a little stupid, huh?

[hhfarang]

U.S. fiscal cliff and debt ceiling dumbed down so that even congress can understand it:

Lesson # 1:

* U.S. Tax revenue: $ 2,170,000,000,000

* Fed budget: $ 3,820,000,000,000

* New debt: $ 1,650,000,000,000

* National debt: $14,271,000,000,000

* Recent budget cuts: $ 38,500,000,000

Let's now remove 8 zeros and pretend it's a household budget:

* Annual family income: $ 21,700

* Money the family spent: $ 38,200

* New debt on the credit card: $ 16,500

* Outstanding balance on the credit card: $142,710

* Total budget cuts so far: $ 38.50

OK now,

Lesson # 2:

Here's another way to look at the Debt Ceiling:

Let's say, You come home from work and find

there has been a sewer backup in your neighborhood....

and your home has sewage all the way up to your ceilings.

What do you think you should do ......

Raise the ceilings, or remove the shit?

[chuckd]

More news is coming out on the compromise for the Obama tax hike.

-----------------------------------------------------------------------------------

Senate-Passed Deal Means Higher Tax on 77% of Households

By Richard Rubin - Jan 2, 2013 1:54 AM GMT+0700

The budget deal passed by the U.S. Senate today would raise taxes on 77.1 percent of U.S. households, mostly because of the expiration of a payroll tax cut, according to preliminary estimates from the nonpartisan Tax Policy Center in Washington.

More than 80 percent of households with incomes between $50,000 and $200,000 would pay higher taxes. Among the households facing higher taxes, the average increase would be $1,635, the policy center said. A 2 percent payroll tax cut, enacted during the economic slowdown, is being allowed to expire as of yesterday.

The heaviest new burdens in 2013, compared with 2012, would fall on top earners, who would face higher rates on income, capital gains, dividends and estates. The top 1 percent of taxpayers, or those with incomes over $506,210, would pay an average of $73,633 more in taxes.

http://www.bloomberg...households.html

[chuckd]

More analysis becoming public.

-----------------------------------------------------------------------------------

CBO: 'Fiscal cliff' deal carries $4 trillion price tag over next decade

By Peter Schroeder - 01/01/13 02:07 PM ET

The Senate deal to avoid the "fiscal cliff" will add roughly $4 trillion to the deficit when compared to current law, according to new numbers from the Congressional Budget Office (CBO).

The CBO determined Tuesday that the package, hammered out late Monday evening by Vice President Biden and Senate Minority Leader Mitch McConnell (R-Ky.) would — over the next decade — come with a $3.9 trillion price tag.

The agreement, which is pending before the House after passing in a 89-8 Senate vote early Tuesday, would extend lower tax rates on annual household income under $450,000 and postpone automatic spending cuts for two months.

Entire article here: http://thehill.com/blogs/on-the-money/economy/275095-cbo-fiscal-cliff-deal-carries-4-trillion-price-tag

[gatorsoft]

More analysis becoming public.

-----------------------------------------------------------------------------------

CBO: 'Fiscal cliff' deal carries $4 trillion price tag over next decade

By Peter Schroeder - 01/01/13 02:07 PM ET

The Senate deal to avoid the "fiscal cliff" will add roughly $4 trillion to the deficit when compared to current law, according to new numbers from the Congressional Budget Office (CBO).

The CBO determined Tuesday that the package, hammered out late Monday evening by Vice President Biden and Senate Minority Leader Mitch McConnell (R-Ky.) would — over the next decade — come with a $3.9 trillion price tag.

The agreement, which is pending before the House after passing in a 89-8 Senate vote early Tuesday, would extend lower tax rates on annual household income under $450,000 and postpone automatic spending cuts for two months.

Entire article here: http://thehill.com/b...llion-price-tag

The measure has passed the house. It will be interesting to see if any spending cuts ever materialize, or if it will be the same deception and outright lying that it has been in the past. At this point, I'm hoping the dems win again in 2016 so they will have to deal with the shambles they have promoted.

[chuckd]

The House just passed the bill 257-167.

They didn't read this bill either.

Edited January 2, 2013 by chuckd

[farang000999]

[gatorsoft]

Yep! Problem soved. Now back to maxing out my credit cards!

[webfact]

please continue:

US House approves 'fiscal cliff' deal

Full story:

//CLOSED//