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Where Do 'Fiscal Cliff' Talks Stand?

Dec 20, 2012
Originally published on December 20, 2012 11:37 am

Transcript

DAVID GREENE, HOST:

That is something nearly everyone agrees on. If the fiscal cliff is not avoided, it could do some serious harm to the U.S. economy. So let's talk further about whether Congress and the White House are close to some kind of agreement. We'll bring in NPR national political correspondent Mara Liasson. Mara, good morning.

MARA LIASSON, BYLINE: Good morning.

GREENE: So one step we're going to get soon is this House vote on what Speaker Boehner's calling Plan B. It's a Republican plan. The White House doesn't like it. I mean how do you interpret this vote?

LIASSON: Well, it's either we're one step closer to the cliff or this is just part of the two steps forwards, one step backward process that Congress and the White House have to go through. Both sides have to prove to their troops that they're fighting as hard as they can before they make the ultimate compromise, and there are a lot of people who think that there's going to have to be several votes that fail.

We might have to go over the cliff for a little bit. The markets are going to have to weigh in and really exact some pain on lawmakers and taxpayers are going to have to see their taxes go up and get angry before this thing can actually be solved.

GREENE: It sounds like what you're saying is that, I mean there's some political posturing going on. I mean they have to play to their bases, but that the president and Speaker Boehner might, in the end, be pretty close to something.

LIASSON: Well, are - they were pretty close to something. It's still unclear whether they actually can get the votes to pass it. But when you look at where the speaker and the president were, the speaker wanted to raise a trillion dollars in taxes by letting the Bush tax cuts expire for people making over a million dollars. The president wanted to raise $1.3 trillion by letting the tax cuts expire for people earning over $400,000.

On spending cuts, they were very close, Boehner at one trillion, President Obama at 930 billion. So you could really see how they could split the difference if they wanted to.

GREENE: Well, let's talk about the two sides and how - who do they need to convince in terms of, you know, bringing their bases on board with this idea of splitting the difference?

LIASSON: Well, that's always the problem. They've both gone out of their comfort zones in their negotiations, but the question is, will their followers follow them out of their comfort zones? Can the speaker sell a deal? That's always been the big question. It's much easier for the president, although there have been groups on the left, including AARP, the powerful seniors lobby who has gone back to a hard line on Social Security.

They were very unhappy that the president was considering agreeing to a new way of calculating inflation that would affect the rate at which Social Security benefits grow. The speaker has the much harder task here. He does have important figures like Eric Cantor and Paul Ryan on board, but 26 groups on the right, including Heritage Action and the Club for Growth, are against Plan B, even though Grover Norquist, who's you could say the most important outside player on taxes, said it was okay.

But last night the speaker was still scrambling for votes, trying to add some spending cuts, trading domestic cuts for defense cuts into that Plan B to get some votes.

GREENE: No small thing that Grover Norquist comes out and says that he could swallow a tax increase.

LIASSON: Well, yes. On Plan B. We don't know about whether he'll approve of the ultimate compromise.

GREENE: You know, one term that we've heard this week, Mara, is grownups. There was a notion that with what happened in Newtown, Connecticut, that people in Washington would act more like grownups in this whole fiscal debate. Are you seeing that?

LIASSON: Well, we thought for a minute there. You know, you did see after the Newtown shooting, Speaker Boehner did agree to rate hikes. That was the biggest turning point in this entire negotiations. That was a watershed moment. Then the question is, is he backing off from that or not? I do think that the crisis has tended to strengthen the president's hand as crises do for presidents.

He was able to say, let's show one tiny iota of the courage of the teachers in Newtown and do the right thing here. But right now we don't know if things are going backwards or forwards.

GREENE: All right. Mara, thanks so much.

LIASSON: Thank you.

GREENE: That's NPR's national political correspondent, Mara Liasson. Transcript provided by NPR, Copyright National Public Radio.