Cliff Deal: Half of Tax Hikes Go to Boost Spending
As more details emerge about the Senate's hastily-passed deal to avert the "fiscal cliff", the scale of the GOP's capitulation grows more troubling. This morning, it looked as if the Senate GOP had overwhelmingly voted for a $620 Billion tax increase in exchange for almost no real spending cuts. That's bad enough, but an analysis by the Congressional Budget Office reveals that the deal actually contains $330 Billion in new spending over the next 10 years. More than half of the new tax revenue won't go to plugging the deficit, but increasing the size of government.
The deal adds around $50 Billion in new spending this year, primarily an extension of unemployment benefits and the "doc fix", a measure to prevent cuts in Medicare reimbursements to doctors. The deal also includes an extension of various tax credits first enacted in the stimulus bill.
Currently, the House GOP is deciding whether or not to vote on the Senate proposal. While this morning it was widely expected that the House would consider the deal later this afternoon, opposition against the package has been growing throughout the day.
Speaker Boehner promised that any deal brought to the floor would have support from a majority of his caucus. He also promised that any increase in tax revenue would have to be matched by an at least equivalent amount of spending cuts. This deal, however, uses half the new tax revenue to increase federal spending. That's a non-starter for much of the GOP caucus.
If this deal is brought to the floor, one can expect a significant opposition from the rank-and-file GOP. The deal will probably need strong support from Democrats to pass the House.
There is one silver lining, however. The roster of GOP members who support the Senate deal will provide a handy checklist for primaries in 2014.
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