Less
than two weeks remain before the federal government reaches the fiscal
cliff and Congress and the President are still far from reaching a
settlement. Each side has inched closer to the other with respect to
income taxes. President Obama’s most recent proposal included an
extension of the expiring income tax cuts for those making up to
$400,000 (up from his prior stance of $250,000). Meanwhile House
Speaker John Boehner (R-OH) countered by suggesting they be extended for
those making up to $1 million in his Plan B proposal. Note that the
Senate has already passed legislation this year that would extend the
tax cuts for those making up to $250,000 year. The Boehner offer, while
rejected by the President, is significant in that it is the first time
House Republican leadership has publicly supported allowing the tax cuts
to expire for anyone. Still, both sides remain far apart on income
taxes as well as on whether to cut entitlements, what to do about
sequestration, and how to deal with another increase to the debt ceiling
due for early 2013.
Absent
an agreement with the White House, Boehner attempted to bring his Plan B
proposal up for a vote in the House along with an updated version of
the
sequestration replacement bill
authored by Paul Ryan (R-WI) and passed by the House in May that would
replace the pending across-the-board cuts to defense programs with
further cuts to non-defense, domestic programs. Lacking the votes to
pass Boehner's tax cut extension, that bill was pulled from the Floor
late Thursday night. The sequestration replacement bill, however,
passed along party lines by a 215-209 margin. That bill includes
billions of dollars in cuts to SNAP (food stamps) and Medicaid while
also eliminating the Social Services Block Grant, a critical funding
source for child welfare programs. President Obama has threatened a
veto and the Senate has repeatedly refused to take it up, but it is
disconcerting at this late juncture that the House is still targeting
these important social service programs.
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