Cliff looms: Kicking the Can, Washington-style

When it comes to the nation's budget challenges, congressional leaders are fond of saying dismissively they don't want to kick the can down the road.
Associated Press
Dec 27, 2012

But now, a deadline hard ahead, even derided half-measures are uncertain as President Barack Obama and lawmakers struggle to avert across-the-board tax increases and spending cuts that comprise an economy-threatening fiscal cliff.

Congressional officials said Wednesday they knew of no significant strides toward a compromise over a long Christmas weekend, and no negotiations have been set.

After conferring on a conference call, House Republican leaders said they remain ready for talks, urged the Senate to consider a House-passed bill that extends all existing tax cuts, but gave no hint they intend to call lawmakers back into session unless the Senate first passes legislation.

"The lines of communication remain open, and we will continue to work with our colleagues to avert the largest tax hike in American history, and to address the underlying problem, which is spending," the leadership said in a statement.

A short while later Senate Majority Leader Harry Reid, D-Nev. countered that the House leadership should allow action on a Senate-passed bill that lets income tax rates rise only on incomes above $200,000 for individuals and $250,000 for couples. The measure could "pass tomorrow" if put to a vote, he said.

The Senate is due in session Thursday, although the immediate agenda includes legislation setting the rules for government surveillance of suspected spies and terrorists abroad, including Americans, as well as a measure providing $60 billion for victims of Superstorm Sandy.

Obama decided to cut short his Hawaii vacation for an overnight flight expected to get him back to the White House on Thursday.

Apart from the cliff, other financial challenges loom for divided government, where political brinkmanship has become the norm. The Treasury disclosed during the day it would take accounting measures to avoid reaching the government's borrowing limit of $16.4 trillion by year's end. The changes will provide about two months of additional leeway.

Separately, spending authority for much of the government will expire on March 27, 2013.

After weeks of negotiations, the president urged lawmakers late last week to scale back their ambitions for avoiding the fiscal cliff and send him legislation preventing tax cuts on all but the highest-earning Americans and extending unemployment benefits for the long-term jobless. Longer, term, he said he still supports deficit cuts that were key to the earlier talks.

"Everybody's got to give a little bit in a sensible way," he said at the White House.

The House has no plans to convene, following last week's rebellion in which conservatives torpedoed Speaker John Boehner's legislation to prevent scheduled tax increases on most, while letting them take effect on million-dollar wage earners.

"How we get there, God only knows," the Ohio Republican said of efforts to protect the economy — and taxpayers — from the tax increases and spending cuts.

"Now is the time to show leadership, not kick the can down the road," Senate Majority Leader Harry Reid, D-Nev., said a little over a week ago after Boehner announced he would shift his own focus from bipartisan talks to the approach that eventually was torpedoed by his own rank and file.

It's a phrase that political leaders use when they want to suggest others want to avoid tackling major problems, and one that Boehner, House Majority Leader Eric Cantor of Virginia and even Obama as well as Reid have used.

"We have a spending problem. We have to address it, And we're not going to address it by kicking the can down the road," the speaker said at a news conference late last week when he was asked about setting a vote on a plan that Democrats find acceptable.

Cantor recently used the same approach in challenging Obama to agree to savings from Medicare and other benefit programs. "This has to be a part of this agreement or else we just continue to dig the hole deeper, asking folks to allow us to kick the can down the road further and that we don't want to do," he said on Nov. 28.

In fact, it's a phrase that has been in use for over a year as Obama and Republicans jockey for position on pocketbook issues.

In July 2011, when he was struggling with Republicans over the threat of a first-ever government default, Obama said he had "heard reports that there may be some in Congress who want to do just enough to make sure that America avoids defaulting on our debt in the short term. But then wants to kick the can down the road when it comes to solving the larger problem, our deficit."

A few months later, an extension of a payroll tax cut was the issue, and Boehner was insisting on a year-long renewal rather than the temporary plan that passed the Senate with votes from lawmakers in both parties.

"How can you do tax policy for two months?" he asked on Dec. 18, 2011. "I believe that two months is just kicking the can down the road.

"The American people are tired of that."

At issue now is series of tax increases and spending cuts scheduled to kick in with the new year that economists caution could send the economy into a recession.

 

Comments

KURTje

Cut pay & benifits for ALL elected "officials," starting at the top. (Take away their medicial too)

KnuckleDragger

I agree, they've already increase health care premiums and now pharmacy co-pays on retired military. Now it is time for them to feel the pinch. It won't happen though, because that would take real leadership, something that is severely lacking in Washington DC!

Kimo

What kURTje said.....

Contango

Looks like the U.S. is goin' over the "fecal cliff."

Mr. Obama started campaigning for re-election in 2010 and was "too busy" in 2011 & 2012 to address this issue and here we are.

IMO, pass a one yr. extension of the present tax structure, get a new Congress in place and hash this out next yr.

Kick the can a distance of one yr.

The raising of the Fed debt ceiling is also an important but separate issue. According to noted tax cheat and Tresy. Sec'y "Turbo" Timmy - the Gubbermint runs outa money on Dec. 31.

2012 - $16T Fed deficit
2016 - $20T Fed deficit

FORWARD SOVIET!

The Big Dog's back

So who should pay for those wars that bush put on the credit card?

herbie_hancock

So the towers/pentagon were hit were you one of the people that didn't think that warrented some kind of military action? You one of the folks that want to "hug it out" with those who want to do nothing but destroy our way of life? Get educated, the cost of both wars to date is $1.4T
Today the U.S. Debt = $16.5 trillion with it being projected to reach $20 trillion by 2016.
When President Obama took office in 2009 the U.S. Debt = $9.986 trillion
When President Bush took office in 2001 the U.S. Debt = $5.629 trillion
The U.S. owes more money than any other nation in the history of the world
The U.S. debt is up 54% under President Obama in his first three years
By the end of President Obama’s first term the U.S. debt will have increased by a larger amount than under President Bush’s entire two-term presidency
Over 60% of all spending is on the “Big Four" - Social Security, Obamacare, Medicaid, and National Defense

So by the math in Bush's 8 years he added just over $4 Trillion ($94 Billion of that on the war on terror).
In Obama's FIRST term he has added $6 Trillion.
So who's really abusing the Country's "credit card" there BIG dog? Your ignorance in every matter that you comment on is aparent throughout this website.
All woof no knowledge.

KnuckleDragger

So what is our President doing while the cliff looms closer? Taking a 2 million dollar vacation in Hawaii on the taxpayers dime, instead of insisting that no lawmakers leave DC for vacation until this problem is solved. More of that great leadership being shown in DC. Why oh why do we keep sending these same losers back to office?

2cents

(Why oh why do we keep sending these same losers back to office?)

Because they give you FREE STUFF!

Contango

@ KD:

Why do "we" keep sendin' 'em back?

'Cause WE "love" our Congressional reps, but those "other guys" from "other states" - they gotta go.

Davy Crockett got tossed outa Congress by TN voters 'cause he refused to "bring home the bacon." It's always been corrupt!

After losing his seat for a third term, he famously said: "You can go to Hell, I'm going to Texas."

mikel

tax receipts for 2011 was more than 2010. so far, 2012 tax receipts are ahead of 2011. so, could it be that there is a spending problem???

The Big Dog's back

Yeah, those 2 wars bush put on the credit card.

mikel

would you be talking about the same wars that was approved by a democratic controlled house and senate? these would also be the same ones that obama, clinton, pelosi & reid voted for!

Dr. Information

@little puppy. more banter from the left. Go stick to the blizzard talk, politics and guns aren't for you kid. I guess Obama and the Dems have nothing to do with the last 4 years being in Afghanistan and still Iraq?

Dr. Information

This president again has failed our nation. He has failed us all. He has created such a line between the parties that its become nothing more than a "who's Johnson is bigger than who's" contest. He gets on TV for all to see and says that both parties need to work together. So Republicans say hey, lets close some loop holes to generate more revenue. Lets also raise taxes on millionaires......but we want something in return.......entitlement reform. Obama's response.......NOPE.....its my way or the highway baby......oh and btw guys, I want unemployment extended even more.....so now people wont have to work for 3 years.

20 Trillion here we come. Unemployment is going to go up.....just watch and see. And lets not forget about Obamacare.........thats going to hurt this nation as a whole (working class), so bunker down.

Dr. Information

This nation brings in about 4 billion a day but spends 11..........GREAT BUSINESS we are running here. Top 3 items..... Social Security (the ultimate Ponzi Scheme), Defense....and Welfare.

The Big Dog's back

Gov is not a business.

mikel

i knew it was to good to be true.

Dr. Information

Oh really. Explain how it isn't a business. It collects, taxes, and spends.......its a business, but I expect nothing other from your typical liberal posts. Im sure you think we don't have a spending problem as well.

SamAdams

Washington doesn't have an income problem. It has an "outgo" problem. The problem for all of the REST of us is that the vast majority of politicians have one special interest or another they won't see cut (or that they insist be funded), and neither side seems willing to see the full extent of the corruption and egregious waste that's pervasive in virtually all government agencies/programs.

NO NEW TAXES. In fact, lower the old ones. And STOP SPENDING MONEY LIKE DRUNKEN SAILORS! (In defense of drunken sailors, at least they spend their own money...) Medicare abuses alone amount to millions. Add welfare fraud, agency inefficiencies, and greedy government workers (including politicians), and reform alone would eliminate the deficit and strengthen the economy! Of course, Washington won't do that. It would actually work...

Contango

Anyone following Japan and their new PM Abe?

He wants the BOJ to crank up the presses and cheapen the value of the currency in order to help increase exports. It's a "race to the bottom" worldwide.

Noted investor Jeff Gundlach expects the Yen to collapse because it won't be able to service it's debt. It'll be the "canary in the coal mine."

Like our Fed, they're monetizing their debt. Savers are getting killed with zero interest rate policies (ZIRP).

The seventy yr. fiscal experiment of cheap money and easy credit in order to fuel economic growth and consumer spending is in its last stages.

The early word is that Christmas sales were not much better than 2011.

Got gold?

You can always trade your gold for fiat currency, but someday you won't be able to use your fiat currency to buy gold.

mikel

i love these comments! its only a matter of time before doggie and puttytat ruin the day.

shucks

Someday no one will be able to use gold unless he has the mark.

Revelation 13:16-17 (New Living Translation (NLT)

" He required everyone—small and great, rich and poor, free and slave—to be given a mark on the right hand or on the forehead. And no one could buy or sell anything without that mark, which was either the name of the beast or the number representing his name."

Randy_Marsh

What does that have to do with anything? Basing economic trends off of end of the world prophecys does not work too well. The world ended last friday and my investment in anti-sun flare cream was a total bust.

Contango

Relax. An interpretation of ancient Hittite writings reveals that the "End Time" will not begin until the Browns have won four consecutive Super Bowls.

shucks

That would be a miracle.

donutshopguy

Gold is about as worthless as paper money. When the $hit hits the fan do you want a shiny metal or food. I'll bet we all choose food.

Contango

IMO, for currency collapse - gold and silver; for a new Dark Ages - guns and grub.

Preparation depends on which scenario you expect and the severity thereof.

Dr. Information

and guns and bullets.....dont forget.

Really are you ...

We need to elect all new officials for the house and senate. IMO they make too much money, if not from a salary stand point, special intrest groups. They are not there to support the top 10%, they are there to represent the State's people they were elected from. They are there to prevent this fisical cliff kind of thing from happening, balance the national budget, and so on. Their anti-american point of views are what got us here. What do I mean? Letting american based companies go overseas to make bigger profits selling goods back to the United States consumer. Not changing NAFTA from Free Trade to Fair Trade. Tax loop holes for millionaires and Corporations, once you are a millionaire or a multimillion dollar corp. how many more millions do you need to hide to maintain that status? Promotion for the lack of innovation. To be reelected the members on Capitol Hill should actually go out and physically campaign the the States that they represent. Make them drive to work daily, no turning their offices into living quarters after work. So if a member of capitol hill makes one hundred thousand dollars in salary pay, the an additional five hundred thousand dollars from special intrest groups. If taxes are increased for persons making over one million dollars a year, they will not see a tax increase. Conforming rules and regulations to shield the special intrest groups they represent, and of course protecting their own money filled pockets. This type of leadership needs to change.

Cowboy

Congress can't figure out how to DO THEIR JOB? Cut their pay until they can figure it out! If I were to go over budget in my operation I would be fired! Why can't we hold these people responsible for the budget that they knew they were responsible for balancing?

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