iReport: Your messages for Washington
House staves off fiscal cliff, but more money squabbles lie ahead
By Holly Yan and Josh Levs, CNN
January 2, 2013 -- Updated 1504 GMT (2304 HKT)
Obama speaks about fiscal cliff deal
STORY HIGHLIGHTS
- NEW: It's the first time since 1993 that tax rates rise for any Americans, according to Tax Foundation
- The vote prevents tax increases for more than 98% of Americans
- It also wards off $110 billion in automatic cuts to domestic and military spending
- Reid accused Boehner of "dictatorship" Friday; Boehner responded with profanity
(CNN) -- After exhaustive negotiations that strained
the country's patience, the House approved a bill to avert the dreaded
fiscal cliff, staving off widespread tax increases and deep spending
cuts.
In the 257-167 vote late
Tuesday, 172 Democrats and 85 Republicans favored the bill; 16 Democrats
and 151 Republicans opposed it.
The approved plan
maintains tax cuts for individuals earning less than $400,000 per year
and couples earning less than $450,000. It will raise tax rates for
those who make more -- marking the first time since 1993 that federal
income tax rates have gone up for any Americans, according to the Tax
Foundation.
The bill also extends unemployment insurance and delays for two months a series of automatic cuts in federal spending.
World markets rose after the news. U.S. stocks jumped, too, with the Dow rising 210 points after opening.
Just hours before the
bill passed, House Speaker John Boehner pitched to fellow Republicans
the idea of amending the Senate-approved bill to add a package of
spending cuts. He cautioned about the risk in such a strategy, saying
there was no guarantee the Senate would act on it.
Obama thanks Biden for 'great work'
Norquist: Fiscal deal not a violation
Cole: "The House worked its will"
Avoid your own personal financial cliff
By the end of the night, he was among the Republicans who voted for the bill as written.
President Barack Obama
said he would sign the bill into law, but he did not say when. After the
vote, he flew to Hawaii to rejoin his wife and daughters on their
winter vacation.
Congress is planning to send the bill to the White House by early afternoon, a Republican leadership aide told CNN.
In practical terms,
there's no urgency on the president's signature. It's up to the Obama
administration to implement the budget and tax changes, and since the
president has said he will sign the measure, the administration can
begin planning for the changes immediately.
Had the House not acted,
and the Bush-era tax cuts expired fully, broad tax increases would have
kicked in. In addition, $110 billion in automatic cuts to domestic and
military spending would have taken place.
The combined effect
could have dampened economic growth by 0.5%, possibly tipping the U.S.
economy back into a recession and driving unemployment from its current
7.7% back over 9%, according to economists' estimates.
While the package provides some short-term certainty, it leaves a range of
big issues unaddressed.
It doesn't mention the $16.4 trillion debt ceiling that the United States reached Monday.
It also puts off the
so-called sequester, cuts in federal spending that would have taken
effect Wednesday and reduced the budgets of most agencies and programs
by 8% to 10%.
Come late February, Congress will have to tackle both those thorny issues.
Obama warned Congress that he will not tolerate another act of prolonged brinksmanship.
"While I will negotiate
over many things, I will not have another debate with this Congress over
whether or not they should pay the bills that they've already racked up
through the laws that they've passed," he said after the Tuesday night
vote.
"We can't not pay bills
that we've already incurred. If Congress refuses to give the United
States government the ability to pay these bills in time, the
consequences for the entire global economy would be catastrophic -- far
worse than the impact of the fiscal cliff."
A partial victory
While the deal gives Obama bragging rights for raising taxes on the wealthiest Americans, it also leaves him breaking a promise.
Obama had vowed to raise
tax rates for the top-earning 2% of Americans, including those with
household income above $250,000 and individuals earning more than
$200,000.
Raising the threshold for higher tax rates shrinks the number of Americans affected.
While nearly 2% of
filers have adjusted gross incomes over $250,000, only 0.6% have incomes
above $500,000, according to the Tax Policy Center.
Some House Republicans weren't exactly overjoyed in voting for the plan.
"I'm a very reluctant yes," said Rep. Nan Hayworth, an outgoing Republican representative from New York.
"This is the best we can
do, given the Senate and the White House sentiment at this point in
time, and it is at least a partial victory for the American people," she
said. "I'll take that at this point."
Conservative lobbyist
Grover Norquist, whose Americans for Tax Reform pushes candidates to
sign a pledge never to raise taxes, said the plan preserves most of the
Bush tax cuts and won't violate his group's beliefs.
"The Bush tax cuts
lapsed at midnight last night," Norquist tweeted Tuesday. "Every
(Republican) voting for Senate bill is cutting taxes and keeping his/her
pledge."
The timing of the vote
was crucial, as a new Congress is set to be sworn in Thursday. And
without a breakthrough, the entire process would have had to start over.
Specifics of the plan
The legislation will raise roughly $600 billion in new revenues over 10 years, according to various estimates.
According to the deal:
-- The tax rate for
individuals making more than $400,000 and couples making more than
$450,000 will rise from the current 35% to the Clinton-era rate of
39.6%.
-- Itemized deductions will be capped for individuals making $250,000 and for married couples making $300,000.
-- Taxes on inherited estates will go up to 40% from 35%.
-- Unemployment insurance will be extended for a year for 2 million people.
-- The alternative minimum tax, a perennial issue, will be permanently adjusted for inflation.
-- Child care, tuition and research and development tax credits will be renewed.
-- The "Doc Fix" --
reimbursements for doctors who take Medicare patients -- will continue,
but it won't be paid for out of the Obama administration's signature
health care law.
The Democratic-led Senate overwhelmingly approved the bill early Tuesday before passing it to the House.
As news about the fiscal cliff's deflection spread across the world, several markets
reacted positively Wednesday.
Australia's ASX All
Ordinaries index added 1.2%. South Korea's KOSPI gained 1.5%, and the
Hang Seng in Hong Kong advanced 1.9%. Tokyo's Nikkei and the Shanghai
Composite remain closed for holiday celebrations but will reopen later
in the week.
Payroll taxes still set to go up
Despite the last-minute fiscal cliff agreements, Americans are still likely to
see their paychecks shrink somewhat because of a separate battle over payroll taxes.
The government
temporarily lowered the payroll tax rate in 2011 from 6.2% to 4.2% to
put more money in the pockets of Americans. That adjustment, which has
cost about $120 billion each year, expired Monday.
Now, Americans earning $30,000 a year will take home $50 less per month. Those earning $113,700 will lose $189.50 a month.
With the latest battle
round over, lawmakers will next set their sights on the other items on
their docket of congressional squabbles over money: the debt ceiling and
resolving the sequester.
Obama said he hopes
leaders in Washington this year will focus on "seeing if we can put a
package like this together with a little bit less drama, a little less
brinksmanship (and) not scare the heck out of folks quite as much."
He thanked bipartisan
House and Senate leaders for finally reaching a resolution Tuesday, but
said Congress' work this year is just beginning.
"I hope that everybody
now gets at least a day off I guess, or a few days off, so that people
can refresh themselves, because we're going to have a lot of work to do
in 2013."
Angry rhetoric flew
In the tense days leading up to the deal, heated words flew between some Democrats and Republicans.
On Friday, after
Democratic Senate Majority Leader Harry Reid accused Boehner of holding a
"dictatorship" in his chamber, the House speaker responded with a
profanity.
"Go f— yourself," Boehner said to Reid, according to a source with knowledge of the exchange in a White House lobby.
CNN's Dana Bash, Rich Barbieri, Charles
Riley, Dana Ford, Matt Smith, Jessica Yellin, Deirdre Walsh and Ted
Barrett contributed to this report.COPY http://edition.cnn.com
Nenhum comentário:
Postar um comentário