With fiscal cliff negotiations coming down to the wire, Senate Minority Leader Mitch McConnell, R-Ky., announced this afternoon that a deal has been reached on taxes. But Democrats are saying that no deal is final until an agreement on spending has been reached.
The emerging tax deal hashed out by McConnell and Vice President Joe Biden includes an extension of Bush-era tax cuts for individual incomes up to $400,000 and family incomes up to $450,000, as well as an increase in the estate tax rate from 35 percent to 40 percent. The compromise would extend the Earned Income Tax Credit, the Child Tax Credit, and the American Opportunity Tax Credit for five years. Spending cuts remain a sticking point.
If a deal is reached, though, the House is unlikely to take it up until tomorrow, when sequestration will have technically gone into effect.
McConnell: Tax Deal Struck with Biden, Now is Time to Avoid Cliff
[National Journal, 12/31/12] McConnell took to the Senate floor this afternoon to announce that he and Biden have struck a deal to prevent tax hikes on the middle class, But Democrats disputed that, saying no deal is final until there is agreement on sequestration.
Cliff Deal Would Extend Tax Cuts for Households up to $450,000
[National Journal, 12/31/12] Biden and McConnell are close to a deal that would extend Bush-era tax cuts for individuals earning up to $400,000 and families earning up to $450,000. But spending cuts remain a sticking point.
Obama Says ‘Fiscal Cliff’ Deal is Within Sight but Some Issues Unresolved
[Washington Post, 12/31/12] Addressing an audience of middle-class Americans early this afternoon, Obama said that a deal is "within sight" but "not done."
House Unlikely to Vote on Any Deal Until After Cliff Deadline
[CNN, 12/31/12] If the Senate agrees to a fiscal cliff deal on Monday, the House is unlikely to vote on it until New Year’s Day, according to several reports. House Republican aides told CNN that the economy would not likely take a hit since the markets are closed on the holiday.
Fiscal Compromise Would Set Stage for a New Year of Mini-Cliffs
[National Journal, 12/31/12] The fiscal cliff is not just one mountain but a series of hills that the country will face over and over again in the coming months. If you thought Washington acted in a dysfunctional manner now, just wait.
What’s the Mood Inside the Capitol?
[National Journal, 12/31/12] It’s New Year’s Eve, the countdown to the fiscal cliff is on, and the message from lawmakers is a collective: Let’s see what happens. Here’s a stitched-together look at how members passed the day.
Wall Street and Financial Markets Await Smoke Signals From the Hill
[National Journal, 12/31/12] The inaction on sequestration hasn’t been particularly surprising to Wall Street, but that doesn’t make the lack of progress any less maddening. Analysts and Wall Street economists say they’ve come to expect gridlock from the federal government, which has cycled through similar fiscal fights during the past two years with the Simpson-Bowles commission, the debt ceiling, the failed super committee, and now, the fiscal cliff.
Markets Head Upward, With Eye on Fiscal Talks
[New York Times, 12/31/12] Stocks rose on Monday after Wall Street heard news of progress on fiscal-cliff negotiations and that a deal was “within sight,” as President Obama said at a press conference. The markets have struggled in recent weeks when going over the cliff looked likely.
Can GOP Claim Some Victory in ‘Cliff’ Debate?
[Wall Street Journal, 12/31/12] Although Sen. Lindsey Graham, R-S.C., said on Sunday that President Obama will likely win the fiscal-cliff battle, WSJ’s Gerald Seib asks why Republicans aren’t claiming any victory. With Democrats accepting and embracing at least 98 percent of Bush-era tax rates, it shows a shift on the left to embrace the Republican proposal.
‘Fiscal Cliff’ Calculator: What It Means for Me
[Washington Post, 12/31/12] The Post takes data from the Tax Policy Center and estimates how families of different means would be affected by both Democratic and Republican proposals to avert the “cliff.” ABC News has its own graphic on what the cliff means, as well.
Congress Pushes to Prevent Spike in Milk Prices from ‘Dairy Cliff’
[National Journal, 12/31/12] A push to avoid the so-called dairy cliff--a Jan. 1 reversion to a half-century-old law that could double the price of milk--was one of the only topics that elicited cheers among House Republicans during a dinner conference on Sunday. House Speaker John Boehner, R-Ohio, had said that a nine-month extension of the previous farm bill could be wrapped into a fiscal-cliff package, a move that would postpone the dairy cliff, among other things.