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Obama, Congress look for way off fiscal cliff

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WASHINGTON - NOVEMBER 16: Speaker of the House John Boehner (R-OH) (L) listens as U.S. President Barack Obama speaks during a meeting with bipartisan group of congressional leaders in the Roosevelt Room of the White House on November 16, 2012 in Washington, DC. Obama and congressional leaders of both parties are meeting to reportedly discuss deficit reduction before the tax increases and automatic spending cuts go into affect in the new year. (Photo by Olivier Douliery-Pool/Getty Images)

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By McClatchy Newspapers
Friday, Nov. 16, 2012, 9:38 p.m.
 

WASHINGTON — President Obama and congressional leaders were optimistic on Friday after opening talks aimed at avoiding a tumble over the fiscal cliff, offering hints of a compromise that would combine new tax revenue with steep spending reductions.

Their hourlong meeting at the White House kicked off what is likely to be an intense, unpredictable November and December as Congress and the White House grapple with how to deal with Bush-era tax cuts that expire at year's end and $109 billion in across-the-board spending reductions set to take effect on Jan. 2.

Obama said after the meeting that they had agreed to work together to find a solution that “includes both revenues and cuts in spending.” The challenge, he said, was to cooperate, “work together, find some common ground, make some tough compromises.”

House Speaker John Boehner, R-Ohio, and Senate Minority Leader Mitch McConnell, R-Ky., who have been loath to consider tax increases as part of a solution to tame the deficit, said after the closed-door meeting that Republicans might consider taxes if they were accompanied by significant spending reductions.

“We are prepared to put revenue on the table, provided we fix the real problem,” McConnell said, adding that most of his caucus thinks that “we're in the dilemma we're in not because we taxed too little, but because we spent too much.”

Back at the Capitol, the mood among Congress' rank and file was largely conciliatory. But there was a sharp reminder that getting a deal through the lame-duck session faces a struggle with each party's ideological wing, where some members dug in on Friday.

“This was a photo op for the president. So be it,” said Rep. Tom Price, R-Ga., a leading conservative.

Among liberal Democrats, Rep. Jim McGovern of Massachusetts warned that “it would be foolish to just assume we're to go along with everything. We're not a cheap date.”

Conservatives insist that tax rates remain the same or go lower.

“We got a loud and clear message from the voters,” said Rep. Steve Scalise of Louisiana, the incoming chairman of the Republican Study Committee, the House's conservative caucus. “The president only defines revenue as raising taxes. We see revenue coming from getting the economy moving again.”

Boehner was more circumspect, saying that Republicans put revenue on the table to demonstrate their seriousness about a solution. He told Obama that without significant tax and entitlement changes, lawmakers will be unable to control the burgeoning budget deficit.

The speaker suggested that tax and entitlement issues may be too complex to solve in a lame-duck session. Negotiators should settle on long-term revenue targets for tax revisions, he proposed, as well as goals for savings from entitlement programs, such as Medicare.

Liberals said they were wary of big spending cuts, particularly those that hurt the poor or significantly cut Medicare.

Both sides in the talks have been open to raising the eligibility age for most Medicare recipients from 65 to 67, but Rep. Peter Welch, D-Vt., cautioned: “This is where the talks are going to get very difficult. There's going to be a desire to shift the burden to beneficiaries.”

The nonpartisan Congressional Budget Office has said that raising the eligibility age would save about $148 billion over 10 years.

Obama and lawmakers agreed that staffers would begin working on a framework that would be presented to them after the Thanksgiving holiday.

 

 
 


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