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Senate OKs Fiscal Cliff Deal; Bill Heads To House Today In Washington, D.C.

6:21 PM, Jan 1, 2013   |    comments
The U.S. Capitol building is seen in Washington, D.C.(Photo: Brendan Hoffman, Getty Images)
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WASHINGTON, D.C. (USA Today) - Vice President Biden huddled with House Democrats on Tuesday as the Republican-led chamber debated when to take up a proposal designed to avoid the tax hikes and budget cuts associated with the fiscal cliff.

The flurry of House activity came just hours after the Senate approved an agreement in the wee hours of New Year's Day, the deadline for the fiscal cliff.

The plan worked out between the White House and Senate leaders would raise taxes on the wealthy, eliminate some -- but not all -- tax hikes for the middle class, and defer a series of budget cuts for two months.

It's not known when, or even if, the House will vote on the package, which critics say does little to reduce the nation's debt and only delays a looming battle over the debt ceiling.

House Speaker John Boehner, R-Ohio, met with his caucus early Tuesday afternoon.

Republicans are debating whether to amend the Senate passed package to add additional spending cuts to appease their conservative flank. Some prominent House conservatives -- including Reps. Justin Amash and Jason Chaffetz -- have already said they will oppose it

House Budget Chairman Paul Ryan, R-Wis., the 2012 Republican vice presidential nominee, declined to talk to reporters on his way into the closed door GOP meeting. "Happy New Year's, guys," he said.

Ryan is widely viewed as a prospective candidate in the 2016 presidential election; two additional potential GOP candidates, Sens. Marco Rubio and Rand Paul, voted against the bill early Tuesday.

Under the Senate deal, taxes would remain steady for the middle class and rise at incomes over $400,000 for individuals and $450,000 for couples - levels higher than President Obama had campaigned for in his successful drive for a second term in office.

Spending cuts totaling $24 billion over two months aimed at the Pentagon and domestic programs would be deferred. That would allow the White House and lawmakers time to regroup before plunging very quickly into a new round of budget brinkmanship certain to revolve around Republican calls to rein in the cost of Medicare and other government benefit programs.

Shortly after the Senate vote, President Obama said, "While neither Democrats nor Republicans got everything they wanted, this agreement is the right thing to do for our country and the House should pass it without delay."

Obama also said the bill takes a balanced approach to shrinking the U.S. deficit by "investing in (the) middle class" while "asking the wealthy to pay a little more."

One set of taxes is set to go up in 2013: The deal does not address the end of the payroll tax holiday on Tuesday. That tax will rise by 2%, back to its 2010 level.

The deal also stops scheduled pay increases for Congress set for spring 2013 and includes a nine-month extension of the farm bill, which had been delayed for months because of differences between the House and Senate versions of the legislation that sets U.S. agricultural policy every five years.

The agreement does not address any increase in the nation's debt ceiling, which -- combined with the delay of automatic spending cuts -- sets up the distinct possibility of another cliff-like budget battle in February.

The omission of the debt ceiling dismayed some liberal Democrats, including Sens. Tom Harkin of Iowa and Sherrod Brown of Ohio. Their criticism prompted Biden to visit Capitol Hill late Monday.

"He's here to hear members' concerns and respond to them," said Reid spokesman Adam Jentleson.

The White House and Congress strike fiscal cliff deal hours before midnight deadline
Senate approves fiscal cliff legislation 89-8 early Tuesday
House debates when to take up the proposal, which critics say won't reduce nation's debt

Vice President Biden huddled with House Democrats on Tuesday as the Republican-led chamber debated when to take up a proposal designed to avoid the tax hikes and budget cuts associated with the fiscal cliff.

The flurry of House activity came just hours after the Senate approved an agreement in the wee hours of New Year's Day, the deadline for the fiscal cliff.

The plan worked out between the White House and Senate leaders would raise taxes on the wealthy, eliminate some -- but not all -- tax hikes for the middle class, and defer a series of budget cuts for two months.

It's not known when, or even if, the House will vote on the package, which critics say does little to reduce the nation's debt and only delays a looming battle over the debt ceiling.

House Speaker John Boehner, R-Ohio, met with his caucus early Tuesday afternoon.

Republicans are debating whether to amend the Senate passed package to add additional spending cuts to appease their conservative flank. Some prominent House conservatives -- including Reps. Justin Amash and Jason Chaffetz -- have already said they will oppose it

House Budget Chairman Paul Ryan, R-Wis., the 2012 Republican vice presidential nominee, declined to talk to reporters on his way into the closed door GOP meeting. "Happy New Year's, guys," he said.

Ryan is widely viewed as a prospective candidate in the 2016 presidential election; two additional potential GOP candidates, Sens. Marco Rubio and Rand Paul, voted against the bill early Tuesday.

Under the Senate deal, taxes would remain steady for the middle class and rise at incomes over $400,000 for individuals and $450,000 for couples - levels higher than President Obama had campaigned for in his successful drive for a second term in office.

Spending cuts totaling $24 billion over two months aimed at the Pentagon and domestic programs would be deferred. That would allow the White House and lawmakers time to regroup before plunging very quickly into a new round of budget brinkmanship certain to revolve around Republican calls to rein in the cost of Medicare and other government benefit programs.

Shortly after the Senate vote, President Obama said, "While neither Democrats nor Republicans got everything they wanted, this agreement is the right thing to do for our country and the House should pass it without delay."

Obama also said the bill takes a balanced approach to shrinking the U.S. deficit by "investing in (the) middle class" while "asking the wealthy to pay a little more."

One set of taxes is set to go up in 2013: The deal does not address the end of the payroll tax holiday on Tuesday. That tax will rise by 2%, back to its 2010 level.

The deal also stops scheduled pay increases for Congress set for spring 2013 and includes a nine-month extension of the farm bill, which had been delayed for months because of differences between the House and Senate versions of the legislation that sets U.S. agricultural policy every five years.

The agreement does not address any increase in the nation's debt ceiling, which -- combined with the delay of automatic spending cuts -- sets up the distinct possibility of another cliff-like budget battle in February.

The omission of the debt ceiling dismayed some liberal Democrats, including Sens. Tom Harkin of Iowa and Sherrod Brown of Ohio. Their criticism prompted Biden to visit Capitol Hill late Monday.

"He's here to hear members' concerns and respond to them," said Reid spokesman Adam Jentleson.

"The argument is that this is the best that can be done on a bipartisan basis," said Sen. Dianne Feinstein, D-Calif., when asked about the case the vice president had delivered behind closed doors.

Biden played a critical role in working out the proposal with Senate Minority Leader Mitch McConnell, Feinstein said. "I think it was very important," she said, noting that McConnell and Biden "have a long prior experience" working together. "That's the reason this is bipartisan."

Sen. Charles Schumer, D-N.Y., said he would put pressure on the House to pass the measure.

House Democratic Leader Nancy Pelosi, D-Calif, did not exactly endorse the deal, saying in a statement: "When a final agreement is reached and passed by the Senate, I will present it to the House Democratic Caucus."

 In a joint statement from House Speaker John Boehner of Ohio and other GOP leaders, they announced the House will "honor its commitment" to take up the Senate bill. They also left open the possibility that the House could seek to amend the deal until their members were given an opportunity to review the deal.

It was unclear how much support the package will have in the House, but McConnell spokesman Don Stewart was optimistic the chamber could approve the package. "(McConnell) has spoken to the speaker throughout the entire process," said Stewart.

Biden has proven a late but potentially crucial player in the budget negotiations. Frustrated by his failure to make progress with Senate Majority Leader Harry Reid, D-Nev., over the weekend, McConnell called on Biden to step in and help move the talks forward. The two have remained in constant contact since then, McConnell said. "I'm happy to report the effort has been a successful one," he said.

By Susan Davis and David Jackson, USA Today

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