With just five days left until the United States goes over the fiscal cliff, things are looking pretty grim for a last-second deal. Last week, right before Congress went on Christmas vacation, House Speaker John Boehner was unable to muster up enough support for his “Plan B” fiscal cliff legislation.
This has left the ball in the Senate’s court to come up with a deal to avoid the mandatory tax increases and spending cuts that will be triggered if a deal is not reached by December 31. His hands tied, Boehner has urged the Senate to come up with a deal and promised the House would consider whatever legislation it came up with.
President Barack Obama is due back in Washington tomorrow and will be meeting with members of Congress in order to hash out a last-second deal. However, even with Boehner’s pleas and Obama’s efforts, a fiscal cliff deal will be an uphill battle.
The Senate would first have to get a deal passed without the Republicans filibustering it, no easy task. Then, all 191 Democrats in the House would have to team up with at least 26 Republicans in order to get the bill passed there. Alternatively, Congress could just let income taxes go up on everyone, cut a deal during the first week of January to bring them back down except for the highest brackets, and then pass a measure to avoid the $109 billion in automatic spending cuts.
Whatever Congress and the President plan on doing, the clock is ticking.
– Benjamin Nanamaker, InvestorPolitics Editor
The opinions contained in this column are solely those of the writer.
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