The Free Press, Mankato, MN

State, national news

December 29, 2012

Washington still working to avoid 'fiscal cliff'

WASHINGTON — Senate leaders worked feverishly behind closed doors Saturday to avert the most painful parts of a looming fiscal crisis, debating which taxpayers could or should pay more as part of a deal that would ward off looming tax increases for everyone.

Senate Majority Leader Harry Reid, D-Nev., and Senate Minority Leader Mitch McConnell, R-Ky., were racing to forge a deal in time for votes tonight by both the Senate and the House of Representatives. Their aides met privately in a nearly deserted Capitol.

Lawmakers expected to be briefed by this afternoon, though some were skeptical a compromise could be reached. Most lawmakers were absent Saturday, awaiting word from their leaders.

Failure to reach agreement by the end of the year Monday evening would mean that all Bush-era tax cuts would expire for all taxpayers, an Obama cut in the payroll tax for Social Security would expire, jobless benefits would dry up for 2 million unemployed, the alternative minimum tax would hit more taxpayers, Medicare payments to doctors would be cut, and $109 billion in federal government spending cuts would start, the first installment toward $1.2 trillion in cuts over two years.

At the center of the private talks Saturday was the question of which Bush-era tax cuts to extend, with Democrats pushing to extend only those on individual income below $200,000 and family income below $250,000, which would mean a tax increase for all income above that. Republicans had been pushing to extend all of the tax cuts, but people close to the talks said they would be open to taxing top wage earners, perhaps those making $400,000 or above -- as Obama had offered as part of an earlier compromise offer.

Negotiators were discussing four other issues as part of a possible scaled-back package -- unemployment benefits, the alternative minimum tax, Medicare payments to doctors and the extension of tax breaks offered to companies and individuals, according to a congressional aide familiar with the talks but not authorized to speak publicly.

But some of the painful measures were increasingly likely to take effect, at least temporarily.

No one was known to be pushing to extend the cut in the payroll tax, enacted as a temporary measure to put more cash in people's pockets in hopes of stimulating the economy. If the cut expires Monday night, every taxpayer would see his paycheck shrink as that tax goes back to 6.2 percent from 4.2 percent.

And a final deal was not expected to include changes to Social Security or Medicare, even though Democrats and Republicans had at one point agreed to apply a less-generous measure of inflation to the government programs to lower cost-of-living adjustments or an increase in the debt limit, which will be reached Monday.

The automatic cuts to spending would also likely go forward after House Republicans signaled that they would not agree to stop them unless or until they could forge a deal for long-term spending cuts.

If Reid and McConnell fail to reach any agreement, Obama will ask Congress to vote on his original proposal to raise taxes on individual income above $200,000 and family income above $250,000, and also to extend jobless benefits for 2 million unemployed workers.

"I believe such a proposal could pass both houses with bipartisan majorities -- as long as these leaders allow it to come to a vote," he said in his weekly radio address Saturday "If they still want to vote no, and let this tax hike hit the middle class, that's their prerogative -- but they should let everyone vote. That's the way this is supposed to work."

As the talks commenced, Obama and Republicans went to the airways to restate their public positions one more time, either aiming to run up public pressure, or to lay the groundwork to blame the other party.

1
Text Only | Photo Reprints
State, national news
  • 1 hurt in fiery Twin Cities interstate crash ROSEVILLE, Minn. (AP) — Authorities say one person was hurt in a fiery crash involving four vehicles on a Twin Cities interstate. The crash on Interstate 35 brought morning traffic to a halt during a rainy commute. The Minnesota State Patrol says a

    July 25, 2014

  • Black box found at Air Algerie wreckage site PARIS (AP) — French soldiers recovered a black box from the Air Algerie wreckage site in a desolate region of restive northern Mali on Friday, officials said. Terrorism hasn't been ruled out as a cause, although officials say the most likely reason f

    July 25, 2014

  • Ukraine reports overnight rebel attacks on border MOSCOW (AP) — The Ukrainian army on Friday claimed that soldiers came under artillery fire from the Russian side of the border overnight and were attacked by rebels in several other places in the restive east. Ukrainian forces are trying to close in

    July 25, 2014

  • Deal still elusive for Gaza cease-fire CAIRO (AP) — Turbulent negotiations to broker a temporary truce in the Gaza Strip are continuing against the backdrop of fresh Israeli attacks on Palestinian militants. U.S. Secretary of State John Kerry met twice Friday in Cairo with U.N. chief Ban

    July 25, 2014

  • Transcript shows concerns during Arizona execution FLORENCE, Ariz. (AP) — U.S. District Judge Neil V. Wake was attending a ceremony for a judicial colleague when he received an urgent — and unusual — request: Lawyers for a condemned inmate wanted him to stop an execution that didn't seem to be workin

    July 25, 2014

  • Sniper-Author-Ventura [Duplicate] Day 3 of deliberations ends in Ventura lawsuit Jury has deliberated 19 hours

    July 24, 2014 1 Photo

  • Man accused of stealing from group HASTINGS (AP) — An Apple Valley man is charged with five counts of theft for allegedly stealing more than $113,000 from a Rosemount youth athletics group. Sixty-two-year-old Robert Steven Reischauer was the former finance manager of the Rosemount Ar

    July 24, 2014

  • Sanders offers lower-cost bill to reform VA Bill would allow vets to go to private doctors

    July 24, 2014

  • Wetland Loss [Duplicate] Report says Prairie Pothole region losing wetlands BISMARCK, N.D. (AP) — Federal officials and conservationists say a recent report detailing wetland losses in the five-state Prairie Pothole Region over the past decade highlights the need for increased protection for the region that provides breeding

    July 24, 2014 2 Photos

  • France: Air Algerie flight vanishes over N Mali ALGIERS, Algeria (AP) — An Air Algerie flight carrying 116 people from Burkina Faso to Algeria's capital disappeared from radar early Thursday over northern Mali, the plane's owner and a French government official said. Air navigation services lost

    July 24, 2014