Gloomy predictions as Washington approaches the 'fiscal cliff'
It's still possible that the 'fiscal cliff' with its automatic tax increases and across-the-board spending cuts can be avoided. But the clock is ticking toward Jan.1, and most lawmakers are pessimistic.
The New Year may be more than a week off, but realistically Congress and the White House have less than that as the clock ticks toward the “fiscal cliff” with its automatic tax increases and across-the-board spending cuts that could throw an already-weakened economy into a tailspin.
On the Sunday before Christmas, lawmakers worried and postured, with a few – very few – expressing just a bit of optimism that anything would be done in time.
"We can do better and we should do better," Senate Budget Committee chairman Kent Conrad said on “Fox News Sunday.” "I would hope that we would have one last attempt here to do what everyone knows needs to be done: which is a larger plan that really does stabilize the debt and gets us moving in the right direction.”
For now, says Senator Conrad (who’s retiring), Speaker John Boehner and the White House should “split the difference” on the most recent offers from both sides, resulting in $1.45 trillion in spending cuts and $1.15 in revenue for a combination of $2.6 trillion.
“You couple that with the $1.1 trillion that’s already been done [in the Budget Control Act] and you’re at $3.7 trillion,” he said.
That leaves a lot of heavy lifting, Conrad concedes: “Is it perfect? No. Is it everything we’d hoped for? No. Does it match what Bowles-Simpson did? No.”