News Column

Obama, Durbin Promote Dem Plan to Avert 'Fiscal Cliff'

Nov. 28, 2012

Susan Davis and David Jackson


President Obama announced Tuesday that he will expand his campaign for a "fiscal cliff" plan that includes higher taxes on wealthier Americans, while a former Senate ally spelled out what many Democrats want in a deal.

Obama met with small-business owners Tuesday about the possible impact of higher taxes and budget cuts that would kick in next year if the White House and Congress are unable to reach a budget deal. He also met with leaders of the group Fix the Debt and key staff members.

On Friday, Obama will make a campaign-style appearance at a toy manufacturing plant in Hatfield, Pa. -- "a business," according to a White House statement, "that depends on middle-class consumers during the holiday season and could be impacted if taxes go up on 98% of Americans at the end of the year."

That is a reference to George W. Bush-era tax cuts that expire at the end of the year. Obama wants to preserve tax rates for the middle class but raise them for Americans who make more than $250,000 a year.

Republicans want to preserve all of the Bush tax cuts and put the emphasis on reduced government spending as the best way to reduce the nation's $16 trillion-plus debt. GOP officials have said they would agree to new government revenue through the closing of tax loopholes.

Congressional Republicans criticized what Senate Minority Leader Mitch McConnell, R-Ky., called Obama's "plans to hit the road" this week.

"In other words, rather than sitting down with lawmakers of both parties and working out an agreement, he's back out on the campaign trail, presumably with the same old talking points we're all familiar with," McConnell said.

Sen. Dick Durbin, D-Ill., said he's optimistic Obama and congressional leaders will reach a deal to avoid the cliff.

"President Obama and Democratic candidates campaigned on the idea that the wealthiest Americans should be asked to pay a little more in taxes -- and voters endorsed it," Durbin, the Senate's No. 2 Democrat, said in a speech at the liberal think tank Center for American Progress.

Durbin reiterated a position supported by Senate Majority Leader Harry Reid, D-Nev., for Congress to extend the individual tax rates for all but the top 2% and allow the rates for those earning more than $250,000 a year to expire at the end of the year and revert to the pre-Bush-era top rate of 39.6%.

The Senate has passed a bill that would extend the rates for all but the wealthiest of Americans, but the GOP-controlled House has not taken up the legislation because Republicans want to maintain the tax rates for all.

Instead, Republicans have coalesced around the idea that enough revenue can be raised to reduce the deficit by eliminating loopholes and capping deductions.

Durbin said income inequality in the USA is a moral issue and tax laws disproportionately favor the wealthy. "Think about this," the senator said. "Hedge fund managers make as much in two minutes as Navy SEALs make in a year. Does that sound right to you? It doesn't to me."

Durbin's speech -- intended to outline the liberal view of how the end-of-year "fiscal cliff" can be avoided -- spelled out a plan to deal with taxes first and entitlements later.

He said Democrats will fight any efforts to gut Obama's health care law or privatize Social Security and Medicare.

Durbin said liberals need to negotiate how to resolve the long-term viability of Medicare and Medicaid, but "those conversations should not be a part of a plan to avert the fiscal cliff." Any proposal that doesn't include some form of entitlement change is widely viewed as a non-starter among Republicans.

"A balanced approach means real cuts, now," McConnell said in reaction to Durbin's speech.

Source: (c) Copyright 2012 USA TODAY

Story Tools Facebook Linkedin Twitter RSS Feed Email Alerts & Newsletters