Washington's playing poker with the fiscal cliff
Poker faces have invaded Capitol Hill as the White House and Congress try to get the other to make a misstep in the ongoing negotiations
to avoid going over the fiscal cliff on Dec. 31 at midnight.
Speaker of the House of Representatives John Boehner has offered a plan to cut deficits by $2.2 trillion over a 10 year period, his counter to the president’s $2 trillion cut in our nation’s deficit.
Both the president and the Republicans have now played their first hand. (By the way there are only 26 days remaining in this last cliff avoidance strategy.)
Part of the cuts put forward by the Republican plan calls for $800 billion in new revenue that would come by increases in tax receipts, not from increased economic growth. This plan would extend the Bush-era tax cuts for all Americans, including the wealthiest.
Further, the GOP plan would slow benefit increases for entitlements and the annual rise in tax brackets. The Boehner plan would save $4.6 trillion if it includes the same additional savings as the White House proposal. The White House had proposed $1 trillion in domestic spending cuts, which had been agreed to last year. This savings would, in part, be realized by the drawing down of expenses currently used to fund the war in Afghanistan (approximately $800 billion).
Both the Republican and White House plans factor in interest savings that would be realized. The U.S. is currently paying $600 billion in interest on the $16.3 trillion national debt.
Calling the president’s hand, the Republicans trotted out that their counteroffer which is closer to the numbers suggested by Erskine B. Bowles, the Democratic co-chairman of the president’s deficit reduction task force. However, Bowles distanced himself from the Republican plan by noting: “It will be necessary for both sides to move beyond their opening positions.”
That means that both the White House and Congress will be playing more poker with the lives and future of every citizen of the United States.
Stay tuned. This poker game is going to get a lot more interesting as we near the edge of the fiscal