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 â€śfiscal cliffâ€ť 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 â€“ very few â€“ 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 â€śFox News Sunday.â€ť "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.â€ť
For now, says Senator Conrad (whoâ€™s retiring), Speaker John Boehner and the White House should â€śsplit the differenceâ€ť 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.
â€śYou couple that with the $1.1 trillion thatâ€™s already been done [in the Budget Control Act] and youâ€™re at $3.7 trillion,â€ť he said.
That leaves a lot of heavy lifting, Conrad concedes: â€śIs it perfect? No. Is it everything weâ€™d hoped for? No. Does it match what Bowles-Simpson did? No.â€ť
The general mood Sunday was well expressed by another senator about to retire, Joseph Lieberman.
"It's the first time that I feel it's more likely we'll go over the cliff than not,"Â Senator Lieberman said on CNNâ€™s â€śState of the Union.â€ť "If we allow that to happen it will be the most colossal consequential act of congressional irresponsibility in a long time, maybe ever in American history because of the impact it'll have on almost every American.â€ť
Joining Conrad on Fox News, Sen. Jon Barrasso (R) of WyomingÂ said tumbling off the fiscal cliff is inevitable.
â€śI believe the president is eager to go over the cliff for political purposes,â€ť he said. â€śHe senses a victory at the bottom of the cliff.â€ť
Obama already has scaled back his ambitions for a sweeping budget bargain. Before leaving the capital on Friday, he called for a limited measure that would extend the Bush-era tax cuts for most people and stave off federal spending cuts. The president also urged Congress to extend jobless benefits for the long-term unemployed that would otherwise be cut off for 2 million people at the end of the year.
But reverting to higher tax rates for even the wealthiest Americans remains a show-stopper for many tea party Republicans in the House of Representatives.
Judging by the latest twists in the drama â€“ including House Speaker John Boehnerâ€™s inability to get his own party behind his â€śPlan Bâ€ť â€“ plus public opinion polls showing Obama with a much better job rating than Mr. Boehner and the GOP seen as mostly to blame, Obama in fact may be more inclined to hang tough.
â€śThe truth of the matter is, if we do fall off the cliff after the president is inaugurated, heâ€™ll come back, propose just what he proposed â€¦ and weâ€™ll end up adopting it,â€ť said Sen. Johnny IsaksonÂ (R) of Georgia on Fox News. â€śWhy not go ahead and act now?â€ť
Why not, indeed, said Sen. Amy Klobuchar, also speaking on Fox News.
"It is time to get back to the table," said the Minnesota Democrat. "And I hope if anyone sees these representatives from the House in line shopping or getting their Christmas turkey, they wish them a merry Christmas, they're civil, and then say go back to the table, not your own table, the table in Washington."
This report includes material from the Associated Press.