Well the small deal passed the Senate at 2am, 89-9.
I think either side could ultimately argue that it was a win, but I think the argument is only slightly stronger with the Democratic side. No real spending cuts at all, permanent Bush tax rates for everybody but the top 2%. Those earning 400+ will see the Clinton rates return, also permanently. Capital gains taxes also go up on those folks. The estate tax will return for estates of $5+ million at 50%.
That's a hair north of 700B. A long with a bit of stimulus, as well.
In return, sequestration gets pushed back two months, with assurances that entitlement reform will be on the table. Right in line with when the debt ceiling fight (which will get its own "approacheth" thread soon).
In a dovetailing of my "approacheth" threads, a nine-month extension of the 2008 farm bill
is being attached to this bill.
The Republican Party can cheer that they got the White House to budge on tax hikes for 250k to 400k, and the debt ceiling was left entirely
alone, since they believe that's a fight they can win.
I think, if nothing else, this cements Joe Biden as one of the most effective Vice Presidents to have ever served -- and reforming the usage of the Vice Presidency may be a lasting legacy of the Obama administration. Biden oversaw the Recovery Act which suffered no scandals, the withdrawal of the Iraq War, quarterbacked the last leg of a critical fiscal cliff deal, and will soon be issuing a gun control report which could change the national conversation on gun rights in January.
Your fiscal cliff deal cheat sheet
Posted by Suzy Khimm
December 31, 2012 at 11:26 pm
The White House and the Senate have finalized the details of their deal to avert the fiscal cliff. The bill basically follows the framework
that came out earlier this afternoon from the McConnell-Biden talks, with key additional details. Here’s the rundown of what it’s likely to look like:
— Tax rates will permanently rise to Clinton-era levels for families with income above $450,000 and individuals above $400,000. All income below the threshold will permanently be taxed at Bush-era rates.
— The tax on capital gains and dividends
will be permanently set at 20 percent for those with income above the $450,000/$400,000 threshold. It will remain at 15 percent for everyone else. (Clinton-era rates were 20 percent for capital gains and taxed dividends as ordinary income, with a top rate of 39.6 percent.)
— The estate tax will be set at 40 percent
for those at the $450,000/$400,000 threshold, with a $5 million exemption. That threshold will be indexed to inflation, as a concession to Republicans and some Democrats in rural areas like Sen. Max Baucus
— The sequester will be delayed for two months. Half of the delay will be offset by discretionary cuts, split between defense and non-defense. The other half will be offset by revenue raised by the voluntary transfer of traditional IRAs to Roth IRAs, which would tax retirement savings when they’re moved over.
— The pay freeze on members of Congress, which Obama had lifted
earlier this year, will be re-imposed
— The 2009 expansion
of tax breaks for low-income Americans: the Earned Income Tax Credit, the Child Tax Credit, and the American Opportunity Tax Credit will be extended for five years.
— The Alternative Minimum Tax will be permanently patched to avoid raising taxes on the middle-class.
— The deal will not address the debt-ceiling, and the payroll tax holiday will be allowed to expire
— Two limits on tax exemptions and deductions for higher-income Americans will be reimposed: Personal Exemption Phaseout (PEP) will be set at $250,000 and the itemized deduction limitation (Pease) kicks in at $300,000.
—The full package
of temporary business tax breaks — benefiting everything from R&D and wind energy to race-car track owners — will be extended for another year.
— Scheduled cuts to doctors
under Medicare would be avoided for a year through spending cuts that haven’t been specified.
— Federal unemployment insurance will be extended
for another year, benefiting those unemployed for longer than 26 weeks. This $30 billion provision won’t be offset.
— A nine-month farm bill fix will be attached to the deal, Sen. Debbie Stabenow told reporters, averting the newly dubbed milk cliff