Senate leaders attempted to hash out a last-minute deal to resolve the fiscal cliff conundrum Dec. 29, but as night fell with no sign of a breakthrough, optimism began to diminish. Minority Leader Mitch McConnell (R-Ky.), who on Friday told reporters he was “hopeful and optimistic” a compromise could be reached, said he still hoped for a deal Saturday morning as he approached a near-empty Capitol.
For his part, Senate Majority Leader Harry Reid (D-Nev.) said Friday evening the next 24 hours were “very important” in the ongoing effort to prevent the nation from slipping over the fiscal cliff—a crisis Congress has been unable to resolve for the past two years. Still, no news could be good news as a Democratic aide told CNN any Republican offer considered “laughable” would likely be leaked to the press, but kept private until Sunday afternoon when Reid and McConnell update their caucuses if reasonable.
In his radio address given each Saturday, President Obama reiterated the optimism he expressed in a Friday speech, stating he still hopes a deal will be reached by the end of the year, but explained he also has a backup plan. He has instructed Reid to hold an up-down vote Dec. 30 on a bare-bones bill that would prevent a tax increase for families earning less than $250,000 per year, as well as extend federal unemployment benefits which otherwise expired Dec. 29. Reid’s proposal would also include a patch to the Alternative Minimum Tax, preventing it from impacting millions of middle-class Americans.
“Leaders in Congress are working on a way to prevent this tax hike on the middle class, and I believe we may be able to reach an agreement that can pass both houses in time,” Obama said. “We just can’t afford a politically self-inflicted wound to our economy.”
According to the New York Times, Senate negotiations are currently dealing with unemployment benefits, as well as cuts in physician Medicare payments, estate taxes and the alternative minimum tax. But Politico reports any last-minute Senate deal is unlikely to raise the national debt limit or roll back the $109 billion in spending cuts to defense and domestic spending, known as the sequester.
“ We’ve been in discussions all day,” McConnell told reporters as he left the Capitol just before 7 p.m. “ We’ve been trading paper all day, and the talks continue into the evening.”
The gap between the two parties requires a lengthy bridge, however, and McConnell is unlikely to support any deal that wouldn’t be favored by House Republicans. He and White House aides have discussed a compromise that would place the income threshold on tax cuts closer to $400,000, but still disagree greatly with Democrats on estate taxes and spending cuts that may or may not be included in the eleventh-hour plan.
Reid, however, is confident he can win an up-down vote should he take his version to the Senate floor, provided Republicans don’t filibuster the proposal. Passage in the Senate would put the pressure on House Republicans to vote on the bill just before the Dec. 31 fiscal deadline.
In the weekly Republican address, Missouri Senator Roy Blunt took ample opportunity to blame Obama and Democratic leadership for failure to take action on the fiscal cliff, but still expressed possibility the two parties could agree before the deadline expires.
“The Senate Majority Leader has refused to bring any appropriations bills to the floor this entire year,” Blunt said. “There’s an old saying that when you fail to plan, you plan to fail, and that’s exactly what they’ve been doing.
“Inaction shouldn’t be an option,” Blunt added. “The problems facing our country are big, but they’re not necessarily all that complicated.
“We still can avoid going over the fiscal cliff if the President and the Democrat-controlled Senate step forward this week and work with Republicans to solve this problem and solve it now.”
Other senators, however, don’t remain as optimistic.
“ I’ve been very surprised that the president has not laid out a very specific plan to deal with this,” Senator Bob Corker (R-Tenn.) said on CBS “This Morning.” “But candidly, Congress should have done the same. And I think the American people should be disgusted.”
In fact, senators were on the edges of their seats throughout the day waiting for word on whether their leaders had reached a compromise that would be voted upon Sunday afternoon.
“It’s a little like playing Russian roulette with the economy,” Senator Mark Warner (D-Va.) told the Times. “The consequences could be enormous.”
House members, who will return from their holiday break Sunday afternoon, also await information. Any bill that passes the Senate will immediately go to the House for possible approval before the deadline. But things could get a little trickier in that side of Congress. The GOP-led House is composed of many members aligned with the Tea Party who are focused on their next election and fear losing the support of anti-tax activists.
Rep. Steven LaTourette (R-Ohio) expressed contempt for his fellow legislators’ misplaced priorities in an interview with CNN.
“I think America should be embarrassed by its leadership in D.C.” LaTourette, who is retiring, said. “The fact that we have been unable to do things, and instead worried about our next elections… I think it’s sinful.”
House Speaker John Boehner has also insisted the Senate only amend a previously-passed House Republican bill which extends all Bush-era tax cuts for an additional year, insisting that all revenue bills must originate in the House, per the U.S. Constitution.
As for the American people? All we can do is watch and wait.