WDEL Blog: Allan Loudell

Senate okays fiscal cliff deal, 89-8; Senator Carper was one of the dissenters; House Republicans overwhelmingly opposed...

Personal chemistry matters in politics, even across partisan lines.

G.O.P. Minority Leader Mitch McConnell and Vice President Joe Biden crafted the fiscal cliff deal. So for the third successive year, Biden and McConnell played an indispensable role in a Inside-the-Beltway policy battle.

Assuming House approval (and that is a BIG assumption), the measure eases the current crisis, but hardly addresses the country's long-term deficit problem. That's the stated reason Senator Tom Carper (D-DE) was one of the few senators to cast a dissenting vote. Interestingly, several national media erroneously put (D-MD) after Carper's name.

By mid-afternoon Tuesday (New Year's Day), Senator Carper's office released a statement explaining the senator's nay vote.

Let me quote from the heart of it:

"...Unfortunately, the deal the Senate passed this morning is not the grand bargain that I, and many of us, had hoped for, and that's why I ultimately voted against it. While I commend the work of Vice President Biden and others in finding a way for us to avoid some of the bad elements of the fiscal cliff, there was a better way to solve this problem and we should've seized the opportunity to do so.

"We've known for some time that there were two principle elements to any genuine budget plan. One, we had to reform entitlements in order to preserve programs like Medicare, Medicaid and Social Security for future generations. And, two, we had to significantly increase federal revenues. Over the last dozen years, they have dropped from roughly 20 percent of GDP, when we had four balanced budgets in a row, to less than 16 percent of GDP today.

"In this deal, we did neither. When push came to shove, we walked away from entitlement and meaningful tax reform, at least for now. Rahm Emanuel, former chief of staff to President Obama, is fond of saying 'Never waste a good crisis.' I'm afraid that we've just wasted a doozie at a time when our President's bargaining power was at its zenith.

Instead of clearly demonstrating to American businesses that are sitting on enormous piles of cash that we can still govern, be fiscally responsible, and provide certainty and predicatability with respect to our tax code, we leave them saying, 'Not again'. Why? Because two months from now, we face the prospect of yet another debt ceiling crisis and more turmoil that will discourage a lot of American businesses from investing their cash in hiring new employees that will help our economy grow.

"The American people want us to do the right thing and not the politically expedient or easy thing. Two times in the last 18 months, President Obama and Speaker Boehner have negotiated in an effort to reach a grand bargain that puts the country on a fiscally sustainable path. Unfortunately, two times, Republicans have chosen not to back their Speaker because of their refusal to consider tax increases on anyone, including those who can most afford it.

"My hope is that this intransigence will someday be overcome, and that the next time there's a serious effort to put together a budget deal, both sides will stay at the table and seize the opportunity to make the hard choices we know have to be made."

The deal would raise tax-rates for families making more than $450,000. It would postpone substantial across-the-board spending cuts for two months.

Kick the can down the road. Another classic Washington battle over raising the debt ceiling looms as early as February.

Predictably, both ideological conservatives AND liberals are displeased with the outcome.

You can hear my Monday midday interview with Senator Chris Coons (D-DE) as the deal was taking shape...

Audio Here

This summation of the deal - and reaction -- from The Los ANGELES TIMES / TRIBUNE papers...


Meanwhile, Vice President Biden's pivotal role prompted NATIONAL JOURNAL's Michael Hirsh to craft an analysis entitled, "Biden May Be the Most Influential Vice President Ever"...


"In 'fiscal cliff' deal, Joe Biden upstages President Obama (+ video)"...


An example of a scathing critique of the deal from the Left (On the NEW REPUBLIC's website at tnr.com)...


Here's a conservative critique...


You can hear my interviews (conducted Noon hour - New Year's Day) with CBS News White House correspondent Peter Maer, and Michael Tomasky, Contributor to NEWSWEEK/The DALY BEAST & Editor of DEMOCRACY: A JOURNAL of IDEAS...

Audio Here

Breaking news, late Tuesday:

"House Republicans are overwhelmingly opposed to the Senate's bill to avert the fiscal cliff, making it nearly certain that Speaker John Boehner's chamber will amend the legislation and sent it back to the Senate -- a potentially serious blow to a package that appeared well on its way to becoming law..." (Politico.com)

Posted at 6:42am on January 1, 2013 by Allan Loudell

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Comments on this post:

Tue, Jan 1, 2013 9:12am
I'm not too surprised about the D-MD error. My wife once said she had met several people who asked her: "Oh, Delaware, isn't that in Maryland?"

Tue, Jan 1, 2013 10:47am
That says a lot for the occupant of the White House. Joe Biden is the most influental VP ever? That's how bad Mr. Obama really is!

Mike from Delaware
Tue, Jan 1, 2013 2:54pm
Prez Obama just doesn't seem to have the leadership ability, or the guts (kahoona's), to play knuckleball with the Republicans. The polls show the American public wants the upper 2% taxed more and Obama won the election, and YET he just can't get 'er done. The GOP folks know if they hold out long enough, he'll give in and they'll get far more of what they want. It's happened over and over during the past two years. It's happening again. It was one reason I voted for Romney; if we're going to end up with GOP policies, might as well put the GOP in charge so we can cut all the infighting and just get the job done.

From where I sit, let's do either the GOP vision or the DEM vision, but pick one and do it. Frankly, from what I've read, both will work. The GOP version is more draconian but will work faster vs. the DEM version that is easier on the public, but will take longer to reach the same goals. But at least do something so this stuck economy can get going again.

It's the indecision of doing nothing year after year that keeps companies from hiring or expanding their businesses in America; and what keeps consumers from buying more (especially big-ticket items like cars, houses, major appliances) than they currently are, as was witnessed by the lesser-than-stellar consumer spending at Christmas.

Will we have a job this time next year if we go over the Fiscal Cliff? If Congress doesn't pull its head out of the sand and make some decisions, all of our taxes are really going to go up in 2013, meaning we need to hold on to our money so we'll be able to pay those taxes next year at tax time, etc., etc.

The truly sad thing is, to Congress this is just a game. None of it affects them, so no big deal. But to the little guy and the so-called Job-Creators, it is a big deal, if for no other reason, you can't make plans, because you don't know how all this will play out. Then add on top of it, Obamacare that no one still knows how much that's going to cost everyone, including businesses, and it's easy to see why no one has confidence and why no one wants to invest, grow, or spend. So gridlock, not just of Congress continues, but the gridlock of our economy continues.

Tue, Jan 1, 2013 6:56pm
Carper did the right decision. We have a big problem and this was the time for the big solution. Obama was correct to have Biden do the negotiation. Biden is his go-to person for Senate issues.

And despite the griping on both sides,(which if you notice is coming from the most ardent of the right and left), the center is breathing a sigh of relief saying "wow, it's a miracle; they actually pulled a compromise out of that pile of rubbish and we all survived."

However, agreements are easy to reach if they don't hurt either party, and that in the long term is the problem Carper readily picked out....

And the best option it appears, is that no one does anything and the cliff comes as it was legislated too long ago.

There is a lot to be said for the expiration of the Bush Tax Cuts across the board. One, all parties bear the responsibilities of putting back the government's finances in order. Losing the tax cuts under $250,000 is as small of a hardship as losing a couple extra billions on a trillion dollar of net worth. But all are contributing.

So, having no deal is actually the best option, I think. And if the Tea Party kills the deal, then, suddenly our deficit problem just took care of itself...

And who, would have ever figured that we would be hailing the recalcitrant members of the Tea Party as heroes? Not I, that's for sure, but if they kill this deal, that is exactly what they will be... just like Tom Carper who cast his symbolic vote against the deal.

Mike from Delaware
Tue, Jan 1, 2013 8:27pm
Kavips: I don't agree. The middle class is the driving force of spending in our economy. Raise their taxes from $2K-4K this year per family and those folks are going to be doing far less spending so they'll have that money to pay Uncle Sam when they file this time next year or as it is deducted each payday having far less money in their pocket through out the year to be able to buy stuff. In either case, that will hurt our fragile economy and possibly push us back into recession. Companies will then lay off more folks meaning the unemployment will go up even higher than it is now resulting in less folks paying taxes, but getting unemployment, so the deficit will get even worse.

It seems that Biden and McConnell did a decent job in hammering out a compromise that both DEMS and GOP in the Senate were able to support. It keeps 99% of the taxpayers getting the Bush Tax Cuts, while that very upper 1% pays more tax, an additional 3.5%. I seriously doubt that anyone making $400K/yr is going to lose their home, default, or declare bankruptcy over paying that additional 3.5%. However, many in the middle and lower classes just might have those things happen IF their taxes go up that much. So at this time, insuring the 99% can continue to buy which makes our economy work (of which supposedly those in the 250K/yr range are "job creators" so lets now see all the jobs those folks create if they get this break again this year via the House vote yet to have happened).

So I disagree with Carper and the TEA party folks in the House who are trying to keep this from being voted on in the House. They need to pass this thing tonight.

Tue, Jan 1, 2013 11:53pm
Mike. I understand your concern except for the fact that if taxes did go up, (house passed it btw) since the scale is graduated, most people would not be paying 2000 to 4500 more..

That is an average figure, where those near the top, at $250,000 would be paying 12,000 or 15,000 more and those at the bottom up to about the 80th percentile, would still pay nothing, because they earned... nothing...

And most of that tax refund came from the child tax credits, and school credits, and were not reflected in the actual rate....

So, that is why i think the opportunity to really attack the deficit now, should have been taken.... We could always change it back if it didn't work. Now, we are going to do the EXACT SAME DEBATE in two months time when we begin discussing the debt ceiling, which btw, we crossed over today.... As I said before, we are now living off the Federal Pension workers plan... lol. I hope Mr. Pizza wasn't counting on his post office pension when he retired...

Wed, Jan 2, 2013 2:34am
Perhaps for tomorrow mornings broadcast?... incandescent 75 watt bulbs are banned from importation starting today....
Next year the 40 and 60 watt bulbs will suffer the same fate. Retailers who have stock on the shelf, can still sell out...

Edison's invention ran up against energy usage....


I didn't know this was put into law.

Wed, Jan 2, 2013 8:29am

Other than raising taxes on those individuals making $400,000 (and families makin $450,000) what specifically will this last minute do, what amount, and to what programs?

Wed, Jan 2, 2013 9:13am
The House has approved a measure which prevents tax hikes for families making under $450,000 and for individuals making under $400,000. The bill is expected to be signed by Obama, who went back on vacation to Hawaii (WTF?)

Meantime, those making $800,000 delivering pizza, can voice their outrage about how these taxes hurt them.

Mike from Delaware
Wed, Jan 2, 2013 10:14am
I doubt there are many folks who deliver pizza, making that kind of Dough - pun intended - heh heh.

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