After Fruitless Weekend, Congress Still Seeks Fiscal Deal

Dec 31, 2012
Originally published on December 31, 2012 5:46 am

It is almost unimaginable that both the House and Senate would be in session on a Sunday evening on the penultimate day of the year. And yet, they both were, with lawmakers hoping it was not merely a big waste of time and effort.

A bipartisan push by Senate leaders over the weekend has so far failed to forge a deal to spare American wage earners from tax hikes and shield government programs from drastic cutbacks.

Congress is meeting again Monday in hopes of a breakthrough — or in an effort to not appear to be asleep at the wheel.

'Significant Distance' Between Parties

Majority Leader Harry Reid took to the Senate floor Sunday night saying the Senate would reconvene Monday at 11 a.m. ET, and that by then he hoped to have further announcements to make about skirting the fiscal cliff:

"There's still significant distance between the two sides, but negotiations continue," he said. "There is still time left to reach an agreement, and we intend to continue negotiations."

Reid had acknowledged earlier that he and his fellow Democrats failed to deliver the counteroffer he'd promised in response to an offer GOP Senate leader Mitch McConnell made Saturday evening.

A frustrated McConnell announced he was reaching out to Vice President Joe Biden in hopes of rebooting the stalled talks.

"There is no single issue that remains an impossible sticking point. The sticking point appears to be a willingness, an interest, or frankly the courage to close the deal," he said. "I want everyone to know I'm willing to get this done, but I need a dance partner."

Snags In The Talks

But Democrats said there was indeed a sticking point: the Republicans' insistence that any deal include a new formula to hold down cost of living increases for Social Security recipients. Reid declared that a nonstarter.

"We're willing to make difficult concessions as part of a balanced, comprehensive agreement," he said, "but we'll not agree to cut Social Security benefits as part of a small or short-term agreement, especially if that agreement gives more handouts to the rich."

A short time later, at a closed-door meeting, Republicans decided to take that politically radioactive Social Security demand off the table. Their chief objection to what Democrats wanted, said Tennessee Republican Bob Corker, was that the president's party sought only to raise more revenues and spend more money.

"There's no deficit reduction in the offer that they're making — pretty phenomenal," he said. "And I don't think any American would want to support that kind of proposal."

One big reason there's no deficit reduction, said Senate No. 2 Democrat Dick Durbin, is that Republicans themselves want some very costly items in the package.

"There's no deficit reduction when you give a higher estate-tax exemption and lower rate, and if you have a permanent fix on AMT, the alternative minimum tax, which costs $800 billion," he said. "So when you put those two on the table, you're up to almost $1 trillion. And those are things they're insisting on."

Determining What's Important

In a rare appearance on NBC's Meet the Press, President Obama said Republicans' actions belied claims they wanted to deal with the deficit in a serious way.

"The way they're behaving is that their only priority is making sure that tax breaks for the wealthiest Americans are protected," he said. "That seems to be their only overriding, unifying theme. And at some point, I think what's going to be important is that they listen to the American people."

Some Democrats vow they won't be bullied into something they'd regret just to avoid the cliff.

"If we get a good deal, fine," says Iowa Sen. Tom Harkin. "But I've always said no deal is better than a bad deal because even if we go — there is no real cliff, I've always said there's a slope anyway — the world won't end."

'Disastrous' Consequences?

The world won't end, but business-as-usual may be disrupted. If Senate leaders can't get a deal, members of both parties say they'll step up.

"We can't very well just throw up our hands and give up," says Republican Susan Collins of Maine. "The consequences are too disastrous for our economy and for the public trust in government. People are furious that we don't have a solution yet."

All that's required, says Senate Finance Committee Chairman Max Baucus, is a little patience.

"I think we'll get this solved. It may take a day or two, maybe three, but we'll get it solved," he says.

But there's only one day left of 2012. Even one day later, efforts to avert the cliff will have failed, and Congress will be left trying to claw its way back up.

Copyright 2013 NPR. To see more, visit http://www.npr.org/.

Transcript

STEVE INSKEEP, HOST:

All right. Let's do this one more time this year. It's MORNING EDITION, from NPR News. I'm Steve Inskeep.

DAVID GREENE, HOST:

And I'm David Greene.

One thing about the drama in Washington right now is fairly normal. Congress sees a problem coming for years, but puts off negotiations until the last minute before a deadline. Again and again, a deal seems possible, then falls apart, only to be revived again.

INSKEEP: What's unusual on this New Years Eve is the extremely highly stakes, barring a deal there will be tax hikes for the overwhelming majority of Americans and cuts to government programs.

GREENE: Now, economists disagree about how severe the effects would really be. And we'll hear about that in a moment.

INSKEEP: We begin on Capitol Hill, where Senate leaders pushed over the weekend to forge a deal, but came up empty.

GREENE: Here's NPR's David Welna.

DAVID WELNA, BYLINE: It is almost unimaginable that both the House and Senate would be in session on a Sunday evening, on the penultimate day of the year. And yet, they both were, with lawmakers hoping it was not merely a big waste of time and effort.

Majority Leader Harry Reid took to the Senate floor Sunday night, saying the Senate would reconvene today, an hour before noon, and that by then, he hoped he would perhaps have further announcements to make about skirting the fiscal cliff.

SEN. HARRY REID: There's still significant distance between the two sides, but negotiations continue. There's still time left to reach an agreement, and we intend to continue negotiations.

WELNA: Reid had acknowledged earlier that he and his fellow Democrats had failed to deliver the counteroffer he'd promised in response to an offer GOP Senate leader Mitch McConnell made Saturday evening.

A frustrated Mitch McConnell announced he was reaching out to Vice President Joe Biden in hopes of jumpstarting the stalled talks.

SEN. MITCH MCCONNELL: There's no single issue that remains an impossible sticking point. The sticking point appears to be a willingness, an interest, or frankly the courage to close the deal. I want everyone to know I'm willing to get this done, but I need a dance partner.

WELNA: But Democrats said there was indeed a sticking point: the Republicans' insistence that any deal include a new formula to hold down cost-of-living increases for Social Security recipients. Reid declared that a nonstarter.

A short time later, at a closed-door meeting, Republicans decided to take that politically radioactive Social Security demand off the table. Their chief objection to what Democrats wanted, said Tennessee Republican Bob Corker, was that the president's party sought only to raise more revenues and spend more money.

SEN. BOB CORKER: There's no deficit reduction in the offer that they're making - pretty phenomenal. And I don't think any American would want to support that kind of proposal.

WELNA: One big reason there's no deficit reduction, said the Senate's number-two Democrat, Dick Durbin, is that Republicans themselves want some very costly items in the package.

SEN. DICK DURBIN: There's no deficit reduction when you give a higher estate-tax exemption and lower rate, and if you have a permanent fix on AMT, the alternative minimum tax, which costs $800 billion. So when you put those two on the table, you're up to almost a trillion dollars. And those are things they're insisting on.

REID: And in a rare appearance on NBC's "Meet the Press," President Obama said Republicans' actions belied claims they wanted to deal with the deficit in a serious way.

(SOUNDBITE OF TV SHOW, "MEET THE PRESS")

PRESIDENT BARACK OBAMA: The way they're behaving is that their only priority is making sure that tax breaks for the wealthiest Americans are protected. That seems to be their only overriding, unifying theme. And at some point, I think what's going to be important is that they listen to the American people.

WELNA: Some Democrats vow they won't be bullied into something they'd regret just to avoid the cliff. Tom Harkin is a senator from Iowa.

SEN. TOM HARKIN: If we get a good deal, fine. But I've always said no deal is better than a bad deal, because even if we go - and there is no real cliff. I've always said it's a slope, anyway. The world won't end.

WELNA: The world won't end, but business-as-usual may be disrupted. If Senate leaders can't get a deal, members of both parties say they'll step up.

Susan Collins is a Republican from Maine.

SEN. SUSAN COLLINS: We can't very well just throw up our hands and give up. But the consequences are too disastrous for our economy and for the public trust in government. People are furious that we don't have a solution yet.

WELNA: All that's required, says Senate Finance Committee Chairman Max Baucus, is a little patience.

SEN. MAX BAUCUS: I think we'll get this solved. It may take a day or two, maybe three, but we'll get it solved.

WELNA: But there's only one day left of 2012. Even one day later, efforts to avert the cliff will have failed, and Congress will be left trying to claw its way back up.

David Welna, NPR News, the Capitol. Transcript provided by NPR, Copyright NPR.