In what was touted as a last chance for lawmakers to reach a deal to avoid the so-called fiscal cliff, leaders of Congress met at the White House to discuss striking a deal at the eleventh hour.
However, as the deadline approaches, outwardly, there seems little to discuss as Democrats look to raise taxes on the more successful taxpayers while Republicans remain divided as to whether any tax increases are acceptable.
Though President Obama called the urgent meeting, the Friday afternoon meeting is the first one held between Congressional leaders and the president since November 16th- an inconvenient fact for the president who pledged to be involved in the negotiations to help formulate a deal to avoid the crisis.
Any deal would face some serious uphill challenges. Democrats have vehemently pledged to include tax increases. Moderate Republicans, led by Speaker of the House John Boehner, have acquiesced to tax increases, but at a much higher income level than Democrats. Meanwhile, conservative Republicans have stuck to their guns and denounced any tax increases as a betrayal of Republican principles. This standoff within the GOP forced moderate Republicans to call off a vote for Boehner’s “Plan B,” which included tax hikes.
If Obama and Senator Harry Reid are able to formulate a proposal, they would have to create a proposal that Senate Republican Leader Mitch McConnell would find tolerable, as the Democrats do not have a supermajority and would be subject to procedural steps that Republicans could implement to block it.
Townhall noted further difficulties with the negotiations:
“The two sides also confronted a divide over estate taxes.
Obama favors a higher tax than is currently in effect, but one senior Republican, Sen. Jon Kyl of Arizona, said he’s ‘totally dead set’ against it. Speaking of fellow GOP lawmakers, he said they harbor more opposition to an increase in the estate tax than to letting taxes on income and investments rise at upper levels.
Also likely to be included in the negotiations are taxes on dividends and capital gains, both of which are scheduled to rise with the new year. Also the alternative minimum tax, which, if left unchanged, could hit millions of middle- and upper-income taxpayers for the first time.
In addition, Obama and Democrats want to prevent the expiration of unemployment benefits for the long-term jobless, and there is widespread sentiment in both parties to shelter doctors from a cut in Medicare fees.”
Claiming that the meeting was “good and constructive,” President Obama stated that he was optimistic. However, Senate Majority Leader Harry Reid seemed less so, stating, “I don’t know timewise how it can happen now.”
Obama, though having been active in the blame game and finger pointing surrounding the stubborn negotiations, spoke harshly about the need to reach a compromise, saying,
“Ordinary folks, they do their jobs. They meet deadlines. They sit down and discuss things and then things happen. It there are disagreements they sort through the disagreements. The notion that our elected leadership can’t do the same thing is mind-boggling to them. It needs to stop. So I’m modestly optimistic that an agreement can be achieved. Nobody’s going to get 100% of what they want. But let’s make sure that middle class families and the American economy and in fact the world economy aren’t adversely impacted because people can’t do their jobs.”
Obama has repeatedly called for lawmakers to pass a quick deal allowing for tax cuts to the middle class with a promise of negotiating later. However, such a plan that cuts taxes for the middle class while raising them on the more successful is precisely what the Obama Administration has been advocating all along and any deal to that effect would likely not be amended at a later date.
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