U.S. House Approves 'Cliff' Bill
President Barack Obama and Vice President Joe Biden makes a statement regarding the passage of the fiscal cliff bill in the Brady Press Briefing Room at the White House in Washington, Tuesday, Jan. 1, 2013. (AP Photo/Charles Dharapak)
The House late yesterday gave final approval to a Senate-backed bill that will let taxes rise for the richest Americans, shield the middle class from tax hikes and extend emergency unemployment benefits, ending Washington’s long drama over the “fiscal cliff.”
The dramatic vote followed a wild day in which the critical measure was assumed for several hours to be headed for defeat because of widespread Republican objections. The vote was 257 to 167, with 85 Republicans joining with nearly all of the chamber's Democrats.
Before the vote, House Minority Whip Steny Hoyer, D-Md., urged his colleagues to vote for the bill “not as a Democrat, not as a Republican, but as an American who understands that our people believe that action is necessary.’’ Yet he expressed some of the reluctance lawmakers on both sides felt over a compromise that seemed to fully please no one.
“I severely regret that this is not a big, bold and balanced plan,” Hoyer said. “We had an opportunity to reach such an agreement in a bipartisan fashion. And we will not reach a big, bold, balanced plan without bipartisanship, because the decisions we’ll have to make will be too difficult not to do in a bipartisan fashion.”
Earlier, in a closed-door meeting with Republican lawmakers, House Speaker John A. Boehner, R-Ohio, and Majority Leader Eric Cantor, R-Va., had outlined options for handling the bill, including a proposal to satisfy conservatives by tacking on billions of dollars in new spending cuts.
But the leaders warned that the Senate was unlikely to approve any changes to the carefully calibrated compromise and that a vote to amend the measure probably would leave the nation facing historic tax increases for virtually every American — and force House Republicans to take the blame.
The other option: Let the measure pass the House unchanged and go to the White House for President Obama’s signature. Late yesterday, it appeared that even some of the chamber’s staunchest conservatives were ready to give up the fight.
“I think the best outcome is to have a clean bill, actually put it on the floor and see what the consensus of the House is,” said Rep. Raul R. Labrador, R-Idaho, a freshman who has opposed every major bipartisan compromise on the budget over the past two years and said he would vote against the measure.
Rep. Lou Barletta, R-Pa., another freshman, said he would support the legislation as the “safest bet” to prevent a major tax increase that many economists predict would throw the nation back into recession.
“The Senate has gone home,” Barletta said. “I don’t know if playing chicken with the American people at this point is in the best interest of the people.”
If approved by the House, the measure would let the top tax rate rise immediately from 35 percent to 39.6 percent on income over $450,000 for married couples and $400,000 for single people — the first broad tax increase in two decades and the first since 1990 to pass Congress with Republican support.
The measure would protect more than 100 million families earning less than $250,000 a year from significant income tax increases set to take effect this month — although payroll taxes will rise for most households in 2013 with the end of a temporary tax cut approved two years ago.
In addition to dealing with the fiscal crisis, the measure would extend federal farm policies through September, averting an estimated doubling of milk prices. The deal also nixed a scheduled pay raise for members of Congress.
After weeks of partisan bickering over whether taxes should rise for anyone, the compromise bill rolled through the Senate in a highly unusual vote early yesterday morning. The measure was approved 89 to 8, with both parties offering overwhelming support.
The moment served as a rare bipartisan coda to what has been one of the most rancorous, partisan Congresses in recent history, as the 11 senators who are retiring received hugs and kisses from their colleagues in both parties.
Three Democrats voted against the measure, including liberal Tom Harkin, Iowa, and moderates Thomas R. Carper, Del., and Michael F. Bennet, Colo. Bennet said the bill would do little to reduce record budget deficits.
According to the nonpartisan Congressional Budget Office, the measure would increase the national debt by $4 trillion over the next decade than if all of the tax hikes and scheduled automatic spending cuts had been allowed to kick in.
Five Senate Republicans also rejected the measure, including tea party favorites Rand Paul, Ky., Mike Lee, Utah, and Marco Rubio, Fla., a potential contender for the 2016 Republican presidential nomination. But 40 others voted for it, including such GOP leaders on tax-and-spending policy as Sen. Patrick J. Toomey, Pa., and Ronald H. Johnson, Wis., a Tea Party star who frequently consults with conservatives in the House.
Neither party was entirely happy with the bill. While conservatives complained about new taxes on the rich and a lack of spending cuts, liberals complained about its provisions regarding inherited estates.
Although the tax rate would rise from 35 percent to 40 percent, estates worth as much as $5 million — $10 million for married couples — would go untaxed. And an inflation adjustment would guarantee that the size of the exemption would grow to $15 million for couples by the end of the decade.
Still, House Democrats largely embraced the measure, which was negotiated by Vice President Biden and Senate Minority Leader Mitch McConnell, R-Ky., and endorsed by Obama.
“It’s long overdue for us to have this solution to go forward and remove all doubt as to what comes next for our country,” House Minority Leader Nancy Pelosi, D-Calif., said after Biden briefed House Democrats on the contents of the bill.
Hours later, Pelosi indicated via Twitter that a “strong majority” of Democrats supported the legislation and that she was “confident” it would pass if Boehner held a vote.
Among House Republicans, however, the measure at first appeared to run into strong opposition. The GOP held two briefings for its members on the bill. After the first, which lasted nearly two hours, Cantor emerged to announce his opposition.
Rep. Jeff Flake, R-Ariz., said Cantor “forcefully” aired his concerns during the closed-door session, during which other GOP members expressed grave doubts about the Senate agreement.
“We should not take a package put together by a bunch of sleep-deprived octogenarians on New Year’s Eve,” said Rep. Steven C. LaTourette, R-Ohio, a moderate and a Boehner ally.
The negative reaction threatened to plunge Washington back into the high-stakes, last-minute drama that has characterized both the fiscal cliff negotiations and a series of other recent confrontations between the two parties over spending and taxes, including the 2011 fight over raising the federal borrowing limit.
Rep. Spencer Bachus, R-Ala., said a “consensus” was developing that the GOP should amend the Senate’s plan and attach additional spending cuts. “I would be shocked if the bill did not go back to the Senate,” he said.
Senate Democrats and administration officials warned darkly that any move to amend the measure would be met with stony silence in the Senate. The House would be responsible for a dive over the cliff hours before U.S. financial markets were set to open today after the New Year’s holiday.
Some House members in the meeting cautioned colleagues that changing the Senate bill would risk damaging the economy and their reputations, Bachus said. But the prevailing view was that Congress must get a handle on government spending or “doom the markets.”
For hours, there was no decision on how to proceed. As leaders huddled, rank-and-file members returned to their offices and were greeted with confusing messages from conservatives and constituents about how to vote.
Former House speaker Newt Gingrich, R-Ga., who has opposed any deal to raise taxes, voiced support for Cantor. But conservative writer William Kristol, who is close to House Budget Committee Chairman Paul Ryan (Wis.), the 2012 GOP vice presidential nominee, wrote a blog post titled “Say Yes to the Mess.”
“Politically, Republicans are escaping with a better outcome than they might have expected, and President Obama has gotten relatively little at his moment of greatest strength,” Kristol said, advising House Republicans to take the deal.
Throughout the evening, Republican leaders surveyed members about the spending-cut package, and concluded that the Senate bill would pass without it. Around 8 p.m., they announced that they would hold a vote within the next few hours with the expectation that Democrats and Republicans would join forces to approve the measure and avoid much of the fiscal cliff.
Paul Kane and Ed O’Keefe contributed to this report.