News / USA

Congress Adjourns for Christmas Without Path Forward to Avert Fiscal Cliff

Cindy Saine
U.S. lawmakers are heading home for the Christmas holidays without any agreement or even a clear path forward on a way to avoid a combination of massive tax increases and spending cuts known as the fiscal cliff.  The entire process came to a standstill late Thursday, when the Speaker of the House of Representatives, John Boehner, was unable to muster enough votes in his own Republican caucus for a bill that would only have raised taxes on incomes of $1 million a year. 

After suffering what most analysts viewed as a humiliating setback to his leadership Thursday, House Speaker Boehner sought to push responsibility onto the president and the Senate, even though the House of Representatives would also have to vote to approve any compromise agreement on taxes and spending.

"So unless the president and Congress take action, tax rates will go up on every American taxpayer, and devastating defense cuts will go into effect in 10 days," he said.

What is the U.S. Fiscal Cliff?

  • An agreement intended to force politicians to compromise and make deals.
  • Without a deal by January 1, 2013, sharp spending cuts would hit military and social programs.
  • Tax hikes also would go into effect.
  • The combination would reduce economic activity, and could boost unemployment and push the nation back into recession.
Crisis negotiations between Boehner and Democratic President Barack Obama were abruptly suspended earlier this week, and Boehner had planned to hold a vote on his own tax plan, "Plan B." 

But he conceded that there are some members of his Republican caucus who do not want to be viewed as raising taxes on anyone at all, so he pulled the vote because the bill would not have passed.  The vote was seen as symbolic because the Democratic-led Senate would not have even taken it up for debate.

Senate Majority Leader Harry Reid said that Boehner had taken a "battering" by his own caucus, and that he should not try to blame the president or congressional Democrats.

"To blame us for that travesty that took place over there, Mr. President, that is pretty incredible," he said.

Reid called on Boehner to reach across the aisle and let the House vote on a measure Democrats could accept, the president's plan to raise taxes on annual incomes of $400,000 or higher.

"What he should do is allow a vote in the House of Representatives on a bipartisan bill, it will pass," he said.

Democratic House Minority Leader Nancy Pelosi said her caucus members are willing to work with the Speaker and the president to prevent potential damage to middle class families and the U.S. economy if the crisis is not resolved.

"There is very little time left, but there is still a chance," she said.  "There is still a chance to reach an agreement that is balanced and that is fair."

Some economists say unless action is taken, the U.S. economy could be plunged back into recession.  Martin Feldstein is a professor of economics at Harvard University, and he warned of the impact of the so-called sequester, across the board cuts to government spending that would also hit defense spending.

"Well, one of the things that happens if we go over the cliff is another very substantial reduction in the defense budget, about $50 billion a year, or about 10 percent reduction in the defense budget," he said.  "It is not clear exactly how that would effect different tasks, security forces, but it would obviously weaken our ability to play the role in Asia and elsewhere that we are accustomed to."

The fiscal cliff measures are set to take effect January 1, and the newly-elected Congress is scheduled to be sworn in January 3.

You May Like

Video Americans, Tourists, Reflect on Meaning of Thanksgiving

VOA garnered opinions from several people soon after November 13 Paris attacks, which colored many of their thoughts

Video Thais Send Security Concerns Down the River

In northern Thailand, the annual tradition of constructing floating baskets to carry away the year’s bad spirits highlights the Loy Krathong festival

Video Tree Houses - A Branch of American Dream

Workshops aimed at teaching people how to build tree houses have become widely popular in America in recent years

This forum has been closed.
Comment Sorting
by: Solopilot from: up in the sky
December 21, 2012 3:01 PM
"The House passed a bill in August that would extend all current tax cuts." The House GOP did their job back in August.

"Senate Democrats have already passed a bill that raises taxes on income higher than $250,000." The Democrats in ths Senate did what the President told them to do.

Missing from the article is what President Obama did, which was re-resubmit his proposed budget. A proposed budget so grossly overbloated with tax increases AND spending increases that, NO Republicans OR Democrats voted for it - TWICE! It would appear that the President is responsible for "going over the fiscal cliff", but doing so may be the ONLY way that spending cuts can be made - in light of the, "social welfare programs that Democrats strongly defend".

by: APasserBy from: Earth
December 21, 2012 2:58 PM
Boehner states: "We see a situation where because of the political divide in the country, because of the divide here in Washington, trying to bridge these differences has been difficult."

Ummm, did he miss the election results or something? Wasn't it clear what Americans as a whole wanted? He's acting and speaking as if the Democrats didn't overwhelmingly win the election. I pity my American neighbors.
In Response

by: Bill from: Mi
December 21, 2012 7:24 PM
On the positive side, it looks like Boehner has committed political suicide? So, at least we have that much.

by: yaaa from: tx
December 21, 2012 2:47 PM
The truth is it is not up to Obama- it is up to Boehner because to become law it must pass the House- Boehner now has to swallow hard and work with Peloci and the bill will not look anything like Plan B.
There will be enough Republicans combined with Democrats to pass a compromise acceptable to the middle in both parties -in the House- but it will not be a Republican bill.

Either way Boehner is toast and one way (no compromise) the Republicans will be toast in 2014.

When lawmakers start representing all of America instead of who gives them money- we will all be better off. Campaign finance reform by Constitutional Amendment!
In Response

by: rgw46 from: usa
December 21, 2012 6:18 PM
should be flat tax..NO other for more fees and BS taxs to companies..they all pass down to consumer anyway..but these career politicians do not care..they stll get paid/healthcare/retirement from OUR tax money,,
In Response

by: GotFiddle from: San Diego
December 21, 2012 3:15 PM
You voted for it: you own it. Whatever THEY do, you elected them. It's yours baby. Next time THINK when you vote. Next time you'll be a lot poorer even skinnier. Give THAT some thought.

by: Peter Frohwein from: Mary Esther, Florida USA
December 21, 2012 2:40 PM
Last time I check it was Mr. Boehner's move ?

The President made an offer, Mr. Boehner made a counter offer,
The President made a counter offer..............then nothing from Mr. Doehner ? Plan B never made it passed conception and was DOA. Plan B was NOT a counter offer........Mr. Boehner it is YOUR move.

by: Anibal from: rocky hill ct
December 21, 2012 2:38 PM
Not my problem , pass the We pay these clowns?
In Response

by: Gotfiddle from: San Diego
December 21, 2012 3:17 PM
YOU also voted for these clowns .. not just Boehner. Hedid nto engineer the cliff Obama did (and now he realizes what he's done but even now THEY could repeal the whole thing but they will not) You voted for it: live it.

by: reubenr from: North East
December 21, 2012 2:30 PM
Dear Mommy,

Please help me. I'm sinking faster than a stone. I've made a fool of myself. You were right, but I'm still not going to make a deal with Barry. I hate him. I just want you to make every thing all right and to make them stop making fun of me.

by: Cranksy from: USA
December 21, 2012 1:22 PM
The Mayan calendar may not foretell an apocalypse, but the Republicans seem hell-bent to set back a recovering economy because of their fealty to their sponsors, the wealthiest Americans, and their sociopathic response to America's minimally compassion social programs.
In Response

by: reubenr from: North East
December 21, 2012 2:48 PM
The Republicans will be putting out their own calendar, soon!

by: David30303 from: Atlanta
December 21, 2012 7:11 AM
"kick-the-can"'s going to be more creative this year.
Too bad even by going over the "cliff" we'll still spend more than we take in.
Thanks Repubi-Crats

by: Anonymous
December 21, 2012 6:53 AM
why don't they stop paying those responsible for this vote until they can make up their minds as to which direction they want this country to go? Up or down?
In Response

by: Bob77021 from: Right Here
December 21, 2012 9:25 AM
Most of the congress are you really think that not paying them a few thousand dollars is going to make them act any differently?

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
After Paris Attacks, France Steps Up Fight Against ISi
November 24, 2015 3:04 AM
The November 13 Paris attacks have drawn increased attention to Syria, where many of the suspected perpetrators are said to have received training. French President Francois Hollande is working to build a broad international coalition to defeat Islamic State in Syria and in Iraq. Zlatica Hoke reports.

Video After Paris Attacks, France Steps Up Fight Against IS

The November 13 Paris attacks have drawn increased attention to Syria, where many of the suspected perpetrators are said to have received training. French President Francois Hollande is working to build a broad international coalition to defeat Islamic State in Syria and in Iraq. Zlatica Hoke reports.

Video US, Cambodian Navies Pair Up in Gulf of Thailand

The U.S. Navy has deployed one of its newest and most advanced ships to Cambodia to conduct joint training drills in the Gulf of Thailand. Riding hull-to-hull with Cambodian ships, the seamen of the USS Fort Worth are executing joint-training drills that will help build relations in Southeast Asia. David Boyle reports for VOA from Preah Sihanouk province.

Video Americans Sharpen Focus on Terrorism

Washington will be quieter than usual this week due to the Thanksgiving holiday, even as Americans across the nation register heightened concerns over possible terrorist threats. VOA’s Michael Bowman reports new polling data from ABC News and the Washington Post newspaper show an electorate increasingly focused on security issues after the deadly Islamic State attacks in Paris.

Video World Leaders Head to Paris for Climate Deal

Heads of state from nearly 80 countries are heading to Paris (November 30-December 11) to craft a global climate change agreement. The new accord will replace the Kyoto Protocol on Climate Change that expired in 2012.

Video Uncertain Future for Syrian Refugee Resettlement in Illinois

For the trickle of Syrian refugees finding new homes in the Midwest city of Chicago, the call to end resettlement in many U.S. states is adding another dimension to their long journey fleeing war. Organizations working to help them integrate say the backlash since the Paris attacks is both harming and helping their efforts to provide refugees sanctuary. VOA's Kane Farabaugh reports.

Video Creating Physical Virtual Reality With Tiny Drones

As many computer gamers know, virtual reality is a three-dimensional picture, projected inside special googles. It can fool your brain into thinking the computer world is the real world. But If you try to touch it, it’s not there. Now Canadian researchers say it may be possible to create a physical virtual reality using tiny drones. VOA’s George Putic reports.

Video New American Indian Village Takes Visitors Back in Time

There is precious little opportunity to experience what life was like in the United States before its colonization by European settlers. Now, an American Indian village built in a park outside Washington is taking visitors back in time to experience the way of life of America's indigenous people. Carol Pearson narrates this report from VOA's June Soh.

Video Even With Hometown Liberated, Yazidi Refugees Fear Return

While the northern Iraqi town of Sinjar has been liberated from Islamic State forces, it's not clear whether Yazidi residents who fled the militants will now return home. VOA’s Mahmut Bozarslan talked with Yazidis, a religious and ethnic minority, at a Turkish refugee camp in Diyarbakır. Robert Raffaele narrates his report.

Video Nairobi Tailors Make Pope Francis’ Vestments

To ensure the pope is properly attired during his visit, the Kenya Conference of Catholic Bishops asked the Dolly Craft Sewing Project in the Nairobi slum of Kangemi to make the pope's vestments, the garments he will wear during the various ceremonies. Jill Craig reports.

Video Cross-Border Terrorism Puts Europe’s Passport-Free Travel in Doubt

The fallout from the Islamic State terror attacks in Paris has put the future of Europe’s passport-free travel area, known as the "Schengen Zone," in doubt. Several of the perpetrators were known to intelligence agencies, but were not intercepted. Henry Ridgwell reports from London European ministers are to hold an emergency meeting Friday in Brussels to look at ways of improving security.

Video El Niño Brings Unexpected Fish From Mexico to California

Fish in an unexpected spectrum of sizes, shapes and colors are moving north, through El Niño's warm currents from Mexican waters to the Pacific Ocean off California’s coast. El Nino is the periodic warming of the eastern and central Pacific Ocean. As Faiza Elmasry tells us, this phenomenon thrills scientists and gives anglers the chance of a once-in-a-lifetime big catch. Faith Lapidus narrates.

Video Terrorism in Many Forms Continues to Plague Africa

While the world's attention is on Paris in the wake of Friday night's deadly attacks, terrorism from various sides remains a looming threat in many African countries. Nigerian cities have been targeted this week by attacks many believe were staged by the violent Islamist group Boko Haram. In addition, residents in many regions are forced to flee their homes as they are terrorized by armed militias. Zlatica Hoke reports.

Video Study: Underage Marriage Rate Higher for Females in Pakistan

While attitudes about the societal role of females in Pakistan are evolving, research by child advocacy group Plan International suggests that underage marriage of girls remains a particularly big issue in the country. VOA’s Ayesha Tanzeem reports how such marriages leads to further social problems.

VOA Blogs