Campaign for Working Families
The stock market celebrated the news of a fiscal cliff deal that preserved the overwhelming majority of the Bush tax cuts. The Dow has been up more than 200 points for most of the day. But the fiscal cliff fight is far from over.
It is worth pointing out that this deal raises only about $60 billion a year in additional revenue. That's less than half of what President Obama originally demanded. Not surprisingly, he's demanding even more of your hard-earned money.
Congressional Republicans don't want the Pentagon to get hit by another wave of cuts from the sequestration deal. But according to a Los Angeles Times report, "As the price for lifting those defense cuts, White House officials have said, the president will demand another round of revenue (tax) increases."
Having conceded to higher taxes on the successful, most Republicans are saying "No more." Senator Pat Toomey (R-PA) is one of the strongest fiscal conservatives in Congress. He grudgingly supported the compromise deal, as did other conservatives like Senators Tom Coburn (R-OK), Jeff Sessions (R-AL) and Ron Johnson (R-WI).
Senators Marco Rubio (R-FL), Rand Paul (R-KY), Charles Grassley (R-IA), Richard Shelby (R-AL) and Mike Lee (R-UT) voted against the deal, along with three Senate liberals. In the House, nearly two-thirds of Republicans opposed the deal, while 90% of Democrats supported it.
Explaining his vote this morning, Senator Toomey said, "We spared as many Americans as we possibly could from a tax increase." But he also said this:
"We're totally done. You can't solve this problem -- I don't care how much you raise taxes. … We will only solve this problem when we finally get the spending under control. And the debt ceiling, and after that, the continuing resolution expiration, those are the vehicles that give us the opportunity to insist on making progress on the real problem."
Spending is the issue, as this chart shows. Savings of $60 billion a year in additional revenue is virtually meaningless when the administration is running deficits in excess of $1,000 billion a year.
But even as President Obama celebrated this compromise deal and higher taxes on the "rich," he warned members of Congress that he would not negotiate on the debt ceiling, saying, "[W]hile I will negotiate over many things, I will not have another debate with this Congress over whether or not they should pay the bills that they’ve already racked up through the laws that they passed."
That's an odd statement to make when it seems obvious he's going to have to negotiate with Congress over the obvious problem -- debt and spending. Unless he's prepared to issue an executive order unilaterally raising the debt limit and creating a constitutional crisis in the process.