N2K Fiscal Cliff: Is That Your Final Offer? White House Huddles with Congress

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Dec. 28, 2012, 10:22 a.m.

In today’s edi­tion of news on the fisc­al cliff, Pres­id­ent Obama met with con­gres­sion­al lead­ers for last minute talks, but none talked to the press af­ter­ward and time is run­ning out on a deal. Sources in­formed re­port­ers that the White House said it was not chan­ging its of­fer. Mean­while, the White House is deny­ing it, but The New York Times is re­port­ing that a scaled-down of­fer is be­ing dis­cussed with Con­gress. And in the Sen­ate, some Re­pub­lic­ans ap­pear will­ing to ac­cept a deal on both tax cuts and the es­tate tax. Fi­nally, stocks fell for a fifth straight day on budget fears.

Obama Not Mak­ing New Fisc­al Cliff Of­fer to Con­gress
[Re­u­ters, 12/28/12] Pres­id­ent Obama was not plan­ning to make a new of­fer to avert the fisc­al cliff, ac­cord­ing to an ad­min­is­tra­tion source, and was set to ask law­makers to hold a vote on a plan that would al­low taxes to rise on those who earn $250,000 and up, and that would ex­tend un­em­ploy­ment in­sur­ance be­ne­fits.

Nar­row­er Tax Deal Floated as Law­makers Sit With Obama
[New York Times, 12/28/12] The White House and con­gres­sion­al lead­ers are ex­plor­ing a new, scaled-back deal that would pre­vent tax in­creases on in­come of $400,000 or be­low, pre­vent an ex­pan­sion of the al­tern­at­ive min­im­um tax and ex­tend oth­er busi­ness tax cuts. It would not, however, stop se­quester cuts. Here’s a handy bar graph of all the vari­ous of­fers.

Ana­lys­is: Cliff Diving Holds Per­ils for Obama’s Second-Term Agenda
[Na­tion­al Journ­al, 12/27/12] Obama’s second-term pri­or­it­ies such as im­mig­ra­tion and gun con­trol — not to men­tion a grand bar­gain on spend­ing and rev­en­ue — could be pushed to the back burn­er if cliff ne­go­ti­ations drag in­to the new year. The saga could also slow Obama’s ef­forts to fill out his Cab­in­et and lim­it his polit­ic­al band­width to fight for con­tro­ver­sial nom­in­ees. 

Why They Want to Go Over the Cliff
[Politico, 12/28/12] Obama, House Speak­er John Boehner, and Sen­ate Ma­jor­ity Lead­er Harry Re­id are locked in on a course for the cliff, and there’s no ob­vi­ous solu­tion that would make any of them switch dir­ec­tion  —  mak­ing the polit­ic­al game, for now, all about op­tics.

Wall Street to D.C.: Get Ser­i­ous About the Fisc­al Cliff
[Na­tion­al Journ­al, 12/28/12] Wash­ing­ton’s in­ac­tion on se­quest­ra­tion hasn’t been par­tic­u­larly sur­pris­ing to Wall Street, but that doesn’t make the lack of pro­gress any less mad­den­ing. And if Con­gress and the White House fail to act on the fisc­al cliff by mid-Janu­ary, the fin­an­cial mar­kets may re­act poorly. Stocks fell for a fifth straight day on Fri­day.

“˜Fisc­al Cliff’ Fo­cus Shifts to Sen­ate; Es­tate-Tax Ex­ten­sion Emerges as Key in Talks
[The Hill, 12/28/12] A crit­ic­al mass of Sen­ate Re­pub­lic­ans ap­pear will­ing to ac­cept a deal that pre­serves most of the Bush-era tax cuts and main­tains the es­tate tax in its cur­rent, watered-down form. But the es­tate tax may prove a stick­ing point for Sen­ate lib­er­als. 

How Cliff-Jump­ing Could Play Out for the Eco­nomy
[Na­tion­al Journ­al, 12/28/12] Many eco­nom­ic fore­casters say a brief slide off the fisc­al cliff might not be cata­stroph­ic. The cliff is more like a slope, those ex­perts say, and the most dam­aging ef­fects won’t be felt im­me­di­ately — though they would be felt quickly.

The Fisc­al Cliff Is Just an Early Battle in a War Dems Will Win
[The New Re­pub­lic, 12/28/12] Noam Scheiber ar­gues that des­pite what some con­ser­vat­ives be­lieve, the fisc­al long game mostly fa­vors lib­er­als.

How the Fisc­al Cliff Will Force Big Biz to Turn Against Small Biz
[Time Magazine, 12/28/12] Un­less Con­gress comes to­geth­er to bring sta­bil­ity back to the fra­gile eco­nomy, big busi­nesses will likely be forced to turn against small busi­nesses, Scott Ger­ber ar­gues, which will in turn force small busi­nesses to turn against Amer­ica’s best in­terests.

Tax Breaks for House­holds Are Big Fisc­al-Cliff Ques­tion Mark
[Re­u­ters, 12/28/12] Lost in the de­bate on the cliff is the fact that a lot of tax breaks, like those for edu­ca­tion and ad­op­tion as well as the al­tern­at­ive min­im­um tax patch, are up for grabs.

Will GOP Al­low “˜Bush Tax Cuts’ to Be­come the “˜Obama Middle-Class Tax Cut’?
[Wash­ing­ton Ex­am­iner, 12/27/12] Philip Klein ar­gues that if the na­tion goes over the cliff, the out­come will be the worst of both worlds for Re­pub­lic­ans: After a deal, taxes will go up on high-in­come earners and Obama will be­come the “great middle-class tax cut­ter.”

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