Obama’s latest offer isn’t good enough for the House GOP. Yesterday, President Obama offered a slightly lower tax hike, raising rates on those making more than $400,000, and modest spending cuts along with a 2-year lift in the debt ceiling as part of his “fiscal cliff” negotiations. Oh, and he asked for another round of stimulus spending, requesting tens of billions for new infrastructure projects. It wasn’t a serious offer. As a result, the GOP is readying to pass a tax fix and seems prepared to go home.
The House GOP is planning, later this week, to pass legislation extending all the Bush tax cuts for families making less than $1 million a year. Presumably, they will also enact “patches” to the AMT tax and extend other tax provisions set to increase at the first of the year.
The House will then go home. Sequestration cuts will take effect, because, even though they hit defense spending, they are real, actual cuts rather than the standard mythical cuts from the “baseline.”
Obama can then either sign the tax extension for all but the very wealthy or veto the bill. Congress would then have another week after Christmas to try to avoid the “cliff”. The GOP, however, seems prepared to take this agreement into next year. We’ll have higher tax rates on those making more than $1 million a year and $1 trillion in across-the-board spending cuts over the next decade.
While Breitbart News has spoken to a number of Congressional offices who say they could live with this deal, it is likely a negotiating tactic to prod Obama to offer more meaningful spending cuts. The GOP’s “Plan B” puts the ball back in the White House’s court.