Think Progress: The House will vote on two separate proposals to extend the Bush tax cuts for people making $250,000 and below or for people making $1 million and below on Thursday.
Steve Benen – Obama, Boehner inch closer to debt deal: “This is no small concession of the president’s part. He proposed higher marginal top rates on income above $250,000, while Boehner counter-offered with a $1 million threshold. Obama, despite a strong public mandate on the issue, has moved his figure to $400,000 in this latest offer, with the expectation that the Speaker will be similarly flexible.
“The president has also lowered his overall tax revenue target to $1.2 trillion, from his initial offer of $1.6 trillion.
“On the other side of the ledger, Obama is offering $1.2 trillion in spending cuts, including $400 billion in health care savings, $200 billion from other mandatory programs such as farm price supports, $100 billion in military spending cuts; $100 billion from domestic programs, $290 billion in savings from lower interest on the debt, and $130 billion is savings from “chaining” the Consumer Price Index. More on that in a moment.
“As part of the same package, the president would expect an extension on unemployment benefits, new infrastructure investments, another Alternative Minimum Tax extension, and a two-year debt-ceiling increase (it’d be up to the administration to do the paperwork, though Congress could try to vote for default if it wanted to).
“Is this a good deal? At a certain level, it doesn’t matter, since Boehner says it’s not good enough and it wouldn’t pass the House. But since it may very well serve as the framework for an eventual agreement, it’s worth paying close attention to its most glaring flaws.”
Greg Sargent – Should progressives accept emerging fiscal cliff deal? The big picture: With this deal Obama will have broken the GOP’s fundamentalist opposition to raising tax rates on the rich (albeit only on income over $400,000) something that would have been deemed very unlikely a year ago. He will have held the line against the GOP demand for two years of Medicare — a victory. Debt ceiling hostage taking will have been deferred for two years, meaning it won’t get tied up in the next elections. He will have obtained stimulus spending — on infrastructure, and in the form of an extension of unemployment benefits — and as Paul Krugman notes, that wouldn’t happen if we go over the cliff. (I’m told the talks have not focused on the exact sum of stimulus spending the White House wants.) The price: The expiration of the payroll tax cut and the cut in Social Security benefits. That’s bad, but the damage could be limited, if the White House insists on it. Obama told us both sides would have to get out of their “comfort zones” in the quest for a deal, and it has been apparent for some time that he prefers a deal to going over the cliff. We now are beginning to see what getting out of that comfort zone looks like.
Paul Krugman – Rumors of a Deal: But the cuts are not nearly as bad as raising the Medicare age, for two reasons: the structure of the program remains intact, and unlike the Medicare age thing, they wouldn’t be totally devastating for hundreds of thousands of people, just somewhat painful for a much larger group. Oh, and raising the Medicare age would kill people; this benefit cut, not so much.The point is that we shouldn’t be doing benefit cuts at all; but if benefit cuts are the price of a deal that is better than no deal, much better that they involve the CPI adjustment than the retirement age. But is this rumored deal better than no deal? I’m on the edge. It’s not clear that going over the cliff would yield something better; on the other hand, those benefit cuts are really bad, and you hate to see a Democratic president lending his name to something like that…