Cliff Averted, But Road Still Bumpy

Posted by on Jan 3rd, 2013 and filed under News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

By Mary  O’KEEFE

“We have a lot of work ahead of us,” said Congressman Adam Schiff.

He was speaking of what lies ahead for lawmakers in Washington, D.C. after the fiscal cliff was averted.

Late on Tuesday the House of Representatives voted 257 to 167 to approve the compromise deal that stopped tax increases to most Americans and delayed spending cuts – for at least a couple of months.

The Senate had passed the plan on Tuesday at about 2 a.m. with a vote of 89 to 8.

The Senate was able to get a majority of Republicans to approve the compromise, however the House was an entirely different story. The bill needed 217 votes to pass; Democrats voted 172 yes with only 16 against. Republicans voted 151 against and 85 in favor. This vote may have given the public a view of things to come within the Republican party.

“I think the biggest problem lies in the House of Representatives,” Schiff said. “The House couldn’t marshal a majority of the GOP.”

The fiscal cliff was the term used to described tax increases and spending cuts that were to take effect at the end of 2012. It would have automatically reduced the federal budget deficit by $503 billion, according to the Congressional Budget Office. However it would have done so by significantly raising taxes and reducing programs. That may have sent the country into recession and raised unemployment, according to economists.

The vote on Tuesday approving the American Taxpayer Relief Act of 2012 will extend income tax rates for individuals’ income up to $400,000 and for couples, or families, income up to $450,000. Estate tax rate would be set at 40% for inheritances over $5 million. The bill also extends unemployment insurance.

Discussions between President Barack Obama, House Speaker John Boehner, House Democratic Leader Nancy Pelosi, Senator Majority Leader Harry Reid and Senate Republican Leader Mitch McConnell were up and down – mostly down – concerning a compromised version of the taxpayer relief act. In the later days of the discussions, Vice President Joe Biden was brought in as well.

In the end a bill was agreed upon by party leaders and taken to their respective branches. The Senate voted first and then it was off to the House.

During the entire discussion, debate and endless sound bites between the two parties, the American voter continued to voice their concern over the inability for Congress to come to an agreement.

“The American people have the right to expect more from those they [send to Washington],” Schiff said. “The people have the right to expect their members of Congress to act like adults and to solve problems.”

And Congress members have a chance to redeem themselves in the upcoming months as they tackle the debt ceiling and sequestration, which will be implemented in two months. Sequestration is automatic spending cuts. That is expected to spark another lively debate.

The country averted the cliff but that doesn’t mean there are no bumps in the road along the budget trail.

Schiff said the solution would not come from passing one really large bill that takes care of everything from taxes to cuts. The problem, he said, needed to be taken in pieces and worked through one item at a time.

But he is not certain that, given the way Congress is working presently, taking it one step at a time will be any easier.

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