Cliff Notes: Happy New Deadline!
Congressional huffing and puffing finally yields a deal
Perhaps it's at least the end of a lousy metaphor. Late on New Year's Day, following a week of Congressional huffing and puffing and a month of media-amplified hysteria, the U.S. House voted 257-167 to accept a "fiscal cliff" deal brokered in the Senate – where the vote had been a surprisingly overwhelming 89-8 (three Dems and five Republicans against). In politico-psychological terms, the Senate got to play bipartisan grownup to the House's recalcitrant teenagers. The Senate agreement with the White House was stage-managed by Kentucky Republican Mitch McConnell and Vice President Joe Biden; House Republicans voted 151-85 against the bill, Democrats 172-16 in favor. (Essentially, despite broad GOP opposition to tax hikes without designated spending cuts, enough House Republicans wanted to avoid blame for "cliff-diving" to save the Senate bill.)
What will it do? It's a stopgap to avoid automatic across-the-board tax hikes and budget cuts that had been built into the Jan. 1 deadline, the alleged "cliff" that had all those $400 TV haircuts on fire. Taxes will rise on the highest earners ($400,000 and up, not the $250,000 threshold Barack Obama had wanted), and less glamorously but importantly, the deal bought another yearlong extension of unemployment benefits, as well as an extension of Medicare payments to doctors that otherwise would have been cut by 27%. And in a major if possibly temporary victory, neither Social Security nor Medicare is affected.
There's also all of a two-month extension on "sequestration" cuts – just in time for the next "debt ceiling" showdown. Obama and the Dems are saying they will not negotiate on the ceiling – that is, raising the federal borrowing limit to pay debts already incurred – while the GOP reportedly sees that crisis as its next opportunity to force a White House surrender. Liberal economist Paul Krugman posted to his New York Times blog Wednesday morning, "[Obama] may say that he absolutely, positively won't negotiate over the ceiling – but nothing in his past behavior makes that believable."
Of the Texas caucus, both Sens. Kay Bailey Hutchison and John Cornyn voted to approve the deal, but Hutchison's replacement, Senator-elect Ted Cruz, said on Facebook that he would have voted no: "The real crisis – spending money we don't have and jeopardizing our children's future – remains totally unaddressed." On the House side, all Texas Democrats and just four Republicans supported the bill, including San Antonio/Austin's Rep. Lamar Smith. Austin/Houston GOP Rep. Michael McCaul released a statement: "At the end of the day I cannot support legislation that increases taxes $41 for every dollar of cuts." Look for much more fun in 2013.