Fis­cal cliff may turn to ‘Plan B’

GOP may re­treat, leave fight on big is­sues for 2013.

Austin American-Statesman - - THE SECOND FRONT - Byan­drew­tay­lor

WASHINGTON — It’s be­gin­ning to look like it’s time for Plan B on the “fis­cal cliff.”

With talks be­tween Pres­i­dent Barack Obama and House Speaker John Boehner ap­par­ently stalled, the lead­ing emerg­ing sce­nario is some vari­a­tion on the fol­low­ing: Repub­li­cans would tac­ti­cally re­treat and agree to raise rates on wealth­ier earn­ers while leav­ing a host of com­pli­cated is­sues for next year.

The idea is that House GOP lead­ers would throw up their hands, pass a Se­nate mea­sure ex­tend­ing tax rates on in­come ex­ceed­ing $250,000, and then duke it out next year over is­sues like in­creas­ing the debt ceil­ing and switch­ing off sweep­ing spend­ing cuts that are pun­ish­ment for prior fail­ures to ad­dress the coun­try’s deficit cri­sis.

It’s eas­ier said than done. That sce­nario has a lot more cur­rency with Se­nate Repub­li­cans, who wouldn’t have to vote for the idea af­ter it comes back to the Demo­cratic-con­trolled Se­nate, than with lead­ers of the Repub­li­can-con­trolled House, who would have to or­ches­trate it and in­sist they’re not aban­don­ing talks with the White House and stand­ing firm against rais­ing tax rates.

“I think it’s time to end the de­bate on rates,” said Sen. Richard Burr, R-N.C. “It’s ex­actly what both par­ties are for. We’re for ex­tend­ing the mid­dle­class rates. We can de­bate the up­per-end rates and what they are when we get into tax re­form.”

“I think we end up with some­thing like this Plan B,” said GOP lob­by­ist Hazen Mar­shall, a long­time former Se­nate aide. “They prob­a­bly fig­ure out some­thing on the rates by the end of the year but on ev­ery­thing else ne­go­ti­a­tions just con­tinue.”

House Repub­li­cans have yet to em­brace the idea.

White House spokesman Jay Car­ney said Obama was still pur­su­ing a broader deal with Boehner that didn’t sim­ply ad­dress the ex­pir­ing tax rates, but also more rev­enue and spend­ing re­duc­tions with a goal of re­duc­ing deficits. But he said that was out of reach if House Repub­li­cans re­fused to let the top rates rise for wealthy earn­ers. “It is still their po­si­tion, as they tell you when you ask them, that they want ex­ten­sion of the high-end Bush tax cuts,” Car­ney said. “The pres­i­dent will not sign such leg­is­la­tion.”

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