Some Dems say go over cliff, and then begin talks

  • Article by: CHARLES BABINGTON and ANDREW TAYLOR , Associated Press
  • Updated: November 14, 2012 - 12:45 PM

But leadership, White House reject the negotiating tactic.

WASHINGTON - Some Democrats are pushing an unorthodox idea for coping with the fiscal cliff: Let the government go over, temporarily at least, to give their party more bargaining leverage for changes later on.

The idea has plenty of skeptics, and the White House regards it frostily. But it illustrates the wide range of early negotiating positions being staked out by Republicans and Democrats as lawmakers gathered Tuesday for their first postelection talks on how to avoid the looming package of steep tax hikes and program cuts.

Just as brazen, in the eyes of many Democrats, is the GOP leaders' continued insistence on protecting tax cuts for the rich. President Obama just won re-election, campaigning on a vow to end those breaks.

Obama reassures labor

Obama assured labor unions and liberal organizations Tuesday that he's firmly committed to letting Bush-era tax cuts for higher incomes expire, as scheduled at the end of the year, even as congressional Republicans accused him of refusing to propose a specific plan to settle a looming budget crisis.

Obama met with the labor and liberal groups for an hour at the White House, his first extended meeting with anyone from outside his administration since he won re-election a week ago.

Democrats and Republicans appear heading toward another round of brinkmanship that will test who blinks first on questions of major importance. It's a dance that has infuriated many Americans, shaken financial markets and drawn ridicule from foreign commentators.

In late 2010, after big GOP midterm election wins, Obama backed off his pledge to raise taxes on the rich. In the summer of 2011, House Republicans pushed Congress within a hair of refusing to raise the debt ceiling, leading to the first-ever downgrade of the government's credit rating. And last December, it was the Republicans' turn to blink, yielding to Obama's demand to extend a payroll tax break.

The fiscal cliff deadline comes in seven weeks. One provision: Unless Congress acts, all Bush-era tax cuts would expire, raising 2013 tax bills for most Americans. Obama wants to end those tax cuts only for households making more than $250,000 a year. Republicans insist on no tax rate increases anywhere.

If the fiscal cliff takes effect, congressional Republicans would feel pressure to give ground in several areas to achieve their top goal: restoring tax cuts for as many people as possible. That's why Sen. Patty Murray, D-Wash., and other Democrats have said their party's leaders should seriously consider letting the Jan. 1 deadline pass and then negotiate with Republicans under sharply different circumstances.

Murray's allies say voters would blame Republicans for refusing to yield, especially on tax rates, given that Obama won re-election. A recent Pew Research poll supports that view. More than half of the respondents said they would chiefly blame congressional Republicans if there's no compromise on the fiscal cliff; 29 percent would blame Obama.

But it's questionable whether Obama and Congress' Democratic leaders would let the government go over the fiscal cliff. Numerous financial analysts say the event would frighten markets, alarm employers and probably trigger a new recession.

And House Minority Leader Nancy Pelosi, D-Calif., showed no interest in the prospect Tuesday. "I want you to be disabused of any notion that there is any widespread thought that it would be a good thing, for our country, for us to go over the cliff."

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