House Republicans' 'fiscal cliff' gripe: When will we ever get spending cuts? (+video)
What riles House Republicans isn't the taxes on the rich in the Senate's 'fiscal cliff' bill, it's the absence of significant spending cuts. But changes at this late date could scuttle the bill.
UPDATE: At 11 p.m., the House voted to pass the Senate's "fiscal cliff" bill, 257 to 167, with 151 Republicans and 16 Democrats opposing the bill.Skip to next paragraph
Subscribe Today to the Monitor
The Senate “fiscal cliff” bill, which blocks the largest tax hike in US history and passed on a stunning 89-to-8 vote early Tuesday morning, now faces an uncertain path in the House, as GOP leaders weigh prospects for adding spending cuts to the bill.
In a surprise move, House majority leader Eric Cantor (R) of Virginia announced on Tuesday that he does not back the bill. Speaker John Boehner (R) of Ohio, who faces reelection as speaker on Jan. 3, has committed to putting a bill on the floor, but has yet to signal his support.
Many House Republicans are troubled by the lack of spending cuts in the deal. Back in the summer of 2011, conservatives fought tooth-and-nail against raising the debt limit and grudgingly agreed only because $1.2 trillion in spending cuts over 10 years – called the "sequester" – were promised to begin no later than Jan. 1, 2013.
Now with that day come – and almost gone – these lawmakers are caught between a desire to hold Congress accountable and a fear that failure to reach a fiscal cliff deal could set off a sharp response on Wall Street Wednesday. The stark fact is that, at this moment, the Senate deal is the only thing preventing the US from plunging fully over the fiscal cliff – the $600 billion in tax hikes and automatic spending cuts that many economists say might throw the country into a fresh recession.
One path House Republicans are considering is adding spending cuts to the deal in the form of amendments. But amendments at this point are perilous for the bill. Any change voted by the House must be approved by the Senate or worked out in a conference committee and passed by both bodies. Senate majority leader Harry Reid (D) of Nevada on Monday told senators not to expect any further votes in the current session of Congress, which expires at noon Thursday.
If nothing is worked out by Thursday, the new Congress must start from scratch.
The Senate bill:
- Blocks tax hikes on individuals with income under $400,000 and families with income of less than $450,000.
- Extends individual and business tax credits.
- Maintains unemployment insurance at 99 weeks.
- Permanently extends the Alternative Minimum Tax (AMT) set to hit some 30 million families.
- Blocks cuts in payments to physicians serving Medicare patients.
- Prevents the estate tax from reverting to previous rules, which hit estates valued at $1 million or above. The current exclusion level is $5 million.