News / USA

US Senate Votes to Avert 'Fiscal Cliff'

House Speaker John Boehner Ohio walks to his office on Capitol Hill in Washington, Jan. 1, 2013.
House Speaker John Boehner Ohio walks to his office on Capitol Hill in Washington, Jan. 1, 2013.
Michael Bowman
The U.S. Senate has overwhelmingly approved a bipartisan agreement to spare most Americans from steep tax hikes and delay across-the-board federal spending cuts imposed by the so-called “fiscal cliff”.

The vote of 89-8 early Tuesday came hours after the United States had technically stepped off the fiscal cliff.

President Barack Obama praised the Senate action and urged the House of Representatives to pass the bill "without delay." The bill needs approval by the House of Representatives before it can be signed into law.

The House plans to convene at noon Tuesday.

Senators spent New Year’s Eve preparing to vote on a bill that was the product of months of intensive and often bitter negotiations between Democratic and Republican lawmakers, and the White House.

VP urged compromise

Before the vote, Vice President Joe Biden came to the Capitol to rally Senate Democrats behind closed doors. He emerged with a broad grin, saying, “Happy New Year. I feel very good about how this vote is going to go.”


  • Raises $600 billion over 10 years through higher taxes on wealthier Americans
  • Delays by two months billions of dollars in mandatory defense and domestic spending cuts
  • Extends farm bill provisions to prevent a spike in milk prices
  • Blocks cuts to payments for doctors who treat elderly Americans
  • Extends unemployment benefits to 2 million people for one year
  • Cancels a $900 cost-of-living raise for members of Congress
  • Extends child tax credits, and those for college tuition and renewable energy

The agreement preserves current federal tax rates on income up to $450,000 a year. President Barack Obama initially sought a lower income threshold for a tax hike, while many Republicans had argued against raising taxes at all.

The agreement also spares estates valued at less than $5 million from inheritance taxes, and extends unemployment benefits for a year. Deep automatic cuts to federal spending that would have squeezed domestic programs as well as national defense would be delayed for two months, allowing time for further negotiations.

Democratic Senator Barbara Boxer of California expressed optimism, saying, “I feel it is very good for my state, and I think it is good for the country.”

Boxer says, without the agreement, the United States would suffer a devastating economic jolt.

“My main concern here is keeping this economic recovery going, and I think this package does that," she said.

No one completely happy

The Senate’s top Republican, Minority Leader Mitch McConnell, said members of his caucus voted for the common good.

“We [Republicans] do not think taxes should be going up on anyone. But we all knew that if we did nothing, they would be going up on everyone today," said McConnell. "We were not going to let that happen.”

To be sure, many Democrats believe the deal does not go far enough to boost government revenue, and many Republicans still want deeper spending cuts to reduce America’s trillion-dollar federal deficit.

Democratic Senator Dianne Feinstein says the agreement is far from ideal, but preferable to the fiscal cliff.

“There is always going to be some carping [partisan complaints]. But look, we are where we are," said Feinstein. "The one thing we have now is a bipartisan majority [backing the deal], and that is not to be easily dismissed.”

Whether a bipartisan majority backs the deal in the House of Representatives remains to be seen. Until and unless the measure is passed by both houses of Congress and signed into law, the austerity regime known as the fiscal cliff - which went into effect at midnight Monday - will remain U.S. law.
Poor, Jobless Worry About US Fiscal Cliffi
January 01, 2013 2:16 AM
Those at the bottom of the economic ladder have much to lose if the country faces automatic tax hikes and spending cuts -- particularly if there are cutbacks in many federal assistance programs. Congress missed its deadline to avoid the so-called fiscal cliff when the House put off any votes Monday evening, even as the president and congressional leaders said they were closing in on a deal. In Los Angeles, Mike O'Sullivan talked with people at a charitable food pantry about their fears.

Some information for this report was provided by Reuters.

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Comment Sorting
by: Ian from: USA
January 01, 2013 10:28 PM
Just as all of you, I am very worry for our country .
My questions are:
-We don't have surplus , then why are our government still sending foreign aid to other countries ? and some of those countries behave like a bunch of ungrateful spoiled kids toward us.
If you don't have money , are you going to send part of your pay check to your neighbors?
-I know it is not fair , but even 50% percent tax will still leave a lot for a person who makes a billion to spend ( 500 millions) than 10% tax for a family of four who try to survive with a 40,000 pay check a year.
-We should really do something about the chinese products that flood this country. When we buy so much of these stuff, we save a few dollars but our neighbors will lose jobs, and a chain reaction will start until it gets to your job's loss. It is absolutely hogwash when the economists telling us that the new chinese upper class will be looking to buy American made brands (No, they won't and they can't, because they already closed all the factories here and shipped jobs over there) Why would the chinese re-import american stuffs that really made in China? how silly is this lie!
-retrain our work force to do what ? everyone becomes sofware architect ? let face it , not everyone is born to be a doctor or lawyer or scientist...someone will need a job as a factory worker.. ortherwise a percentage of our people will face unemployed, that is plain to see . Our policy has to encourage the factories to be here (I don't care if it is taxing the companies that produce things somewhere else)
-and finally, if we import everything from elsewhere, what would happen when we have a war, we won't be capable to make anything for that war....imagine no steel mill, no truck factory, no tire comapny, no computer chip factory ... the list goes on and on. no factory can be constructed in one day,
we will lose .

by: Lumen from: Italy
January 01, 2013 2:58 PM
Please, America, do not become as europe. Don't forget your ancestor's lessons.

by: Carol D from: Palm Bay< FL
January 01, 2013 2:12 PM
Okay at 89 votes for, 8 votes against.....what happened to the other 3????? Did they abstain? Were those Senate seats empty??????
In Response

by: Shirley from: California
January 01, 2013 5:07 PM
When are republicans going to take their heads out of the sand? Voters sent a message in November. If they want to run again in 2014 show they have some backbone and help those of us who do not have millions. Money isn't everything. How can they sleep at night? What is wrong with the speaker? Doesn't he know how to smile>

by: Tran
January 01, 2013 1:28 PM
The other eight senators who voted against the bill probably earned more than half millions dollars a year.

by: javapoppa from: usa
January 01, 2013 11:19 AM
The government is still spending $1,365,000,000,000 more than we take in, 70% of which is manufactured out of thin air by the Fed, and we are supposed to be turning handsprings over this phony 'fiscal cliff' deal? Our government is dysfunctional.
In Response

by: US CITIZEN from: 92029
January 01, 2013 1:29 PM
Please read the three prior arguments: all three refer to failures of others, not the authors themselves. But remember: i is US who drive their politics by our voting decisions: government for the people and BY the people. Pointing fingers at:China, Europe, Islam, Blacks, Whites, Latinos, Jews, Palestinians, Liberals, Democratas, Repaublicans, the Government, the rich, the poor, etc. etc - this is our REAL problem. Look into the mirror, please.

by: Bearman from: U.S.A.
January 01, 2013 7:48 AM
The problems we face today are there because the people who work for a living are now outnumbered by those who vote for a living.
In Response

by: charles from: usa
January 01, 2013 10:59 AM
When are people going to realize that the words of the VP show what is wrong with our Congress today. "VP Biden urges compromise." When are people going to stand up and do what is right for America? All that we have heard over the past months is that we need to cut spending; well, where are the spending cuts Republicans? You have bowed down once again and let your voters down. Each one of you who voted for this bill needs to resign immediately because you are not doing the job you said you would do.

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