Fiscal Cliff Plan: Tax Hikes Now, Spending Cuts Later
According to Politico, the plan shaping up behind the scenes as part of the “fiscal cliff” talks is front-loaded on big tax increases, with most of the spending cuts taking place a decade or so down the road:
Taxes will go up just shy of $1.2 trillion — the middle ground of what President Barack Obama wants and what Republicans say they could stomach. Entitlement programs, mainly Medicare, will be cut by no less than $400 billion — and perhaps a lot more, to get Republicans to swallow those tax hikes. There will be at least $1.2 trillion in spending cuts and “war savings.” And any final deal will come not by a group effort but in a private deal between two men: Obama and House Speaker John Boehner (R-Ohio). The two men had a 30-minute phone conversation Wednesday night — but the private lines of communications remain very much open.
The article notes that Obama isn’t budging on tax hikes, and that Republicans are agreeing to push off the cuts until “between 10 and 20 years from now.”
So tax hikes now, spending cuts probably never given how often Congress actually follows through on these sort of scheduled cuts.
We’d be better off driving the country off the “fiscal cliff.”
Update: Boehner is upset that these details were apparently leaked to Politico after a late-night phone call between himself and the President.Tags: Barack Obama, deficits, fiscal cliff, john boehner, national debt, spending, Taxes