The Fiscal Cliff Deal



boehner-thumbs-up-apThe fiscal cliff deal was passed that included tax increases for those individuals making more than $400,000 a year and households making more than $450,000.  Speaker of the House John Boehner (R-OH) and Congressman Paul Ryan (R-WI) vote yes on the deal joining a minority of Republicans in the House joining with Democrats for the deal to clear the House.  This deal had $1 in spending cuts for every $41 in tax increases.  It also has some calling for an end to Speaker Boehner’s leadership in the House.

Iowa’s Congressional Delegation was split.  Congressmen Steve King (R-IA) and Tom Latham (R-IA) voted no while Democratic Congressmen Leonard Boswell, Dave Loebsack, and Bruce Braley voted yes.

Congressman Latham in a statement issued yesterday said:

The White House-Senate compromise contains some good provisions I agree with, such as preventing massive tax hikes on most families and finally making the cuts permanent, extending the farm bill, and maintaining the wind energy tax credit. However, it lacks a critical component: necessary spending cuts to address our exploding debt. Our $3.5 trillion budget is and will continue to be our primary fiscal obstacle, and a bill that increases taxes and fails to even begin to address spending decisions is not the action American taxpayers have asked for.

In recent weeks, House Republicans put forth revenue increases as part of a balanced plan that would also tackle Washington’s out-of-control spending. Instead of responding in-kind, the President and Senate leadership focused on tax hikes as the centerpiece of any potential deal, and in so doing, they abandoned the historic opportunity to take on deficit reduction in a serious manner.

Because the final legislation asked everything of taxpayers while not forcing Washington to even begin a single step toward curbing its spending addiction, I cannot support it.

Senator Chuck Grassley (R-IA) was one out of only five Republican senators to vote no on the fiscal cliff deal.  He said in a statement:

It’d be one thing to raise taxes to reduce the deficit, but that’s not what this deal does. It’s a fiscal farce to raise taxes and hurt economic growth only to fuel more government spending with record deficits and debt. People at the grass roots want Washington to spend less, not more. Failure to deal with spending lets them down. Spending restraint ought to be more than a wishful new year’s resolution with no way to be certain it’s kept.

I support preventing tax increases on Americans by extending the tax cuts I authored in the Senate in the last decade. After the election, Republican leaders in Congress offered revenue increases as part of a balanced deal that would also take on Washington’s spending problem. Instead, the President focused on raising taxes and missed a significant opportunity to tackle spending. Washington has a spending problem, not a taxing problem, and this deal doesn’t do anything about the spending problem.

This legislation contains a lot of things I support in addition to preventing a tax increase, including an extension of the farm bill, preventing tens of millions of families from being subject to the Alternative Minimum Tax that was never meant for them, repeal of the CLASS Act from the 2010 health care law, and the extension of the wind-energy production tax credit that I authored in August. Nevertheless, the fiasco was a major missed opportunity to take on Washington’s spending problem. The President focused on increasing taxes and failed to provide the presidential leadership needed to put Washington on a new path for fiscal discipline.

Former Republican Presidential candidate, Rick Santorum, also spoke out against the deal.

Last night’s actions in the House and Senate were only our elected officials kicking the can down the road rather than make meaningful changes on spending cuts and tax reforms.   As well-intentioned as it may be, the compromise passed by the Senate and House is at best a short-term band-aid and at worst a prescription for further economic decline in our country."

It is clear that under the current rules of the game in Washington combined with an absence of leadership, our country needs structural changes to force leaders to do what is in the best long-term interest of our country.  That is why there should be not a single vote for any deal to avoid the real fiscal cliff — the debt ceiling increase — without the passage of a Balanced Budget Amendment to the Constitution."

President Obama and the Democratic leadership showed no courage by refusing to tackle the real fiscal challenges we face.  When given the chance to reform entitlements, Obama and the Democrats said no.  When given the chance to fight for meaningful tax reform, they said no.  And when given the chance to work towards finding a solution that won’t burden our children and grandchildren with trillions of new debt, they said no.

I know great efforts were made by Senate and House Republicans to deliver a better package, but what has passed does nothing more than provide a temporary fix on a system that is severely broken for the long-term.

Update: Congressman Steve King just released a statement on the fiscal cliff deal.

I could not vote for this bill because, as a whole, it’s bad for our country.  There are a number of provisions in this bill that I support, such as those addressing the Alternative Minimum Tax, the Farm Bill extension, the Production Tax Credit for wind and biodiesel, and making certain tax policies permanent- but I’m not for the permanent and accelerated growth in our debt and deficit. This bill makes no effort to curb the out of control federal spending that’s to blame. In fact, it proactively puts off, for another two months, the sequestration – the only serious effort to begin reining in federal spending that’s currently on the table. This bill will ensure that the President has yet another opportunity two months from now to pressure Congress for more tax and revenue increases.

The President says he is for a balanced approach to deficit reduction, but this is nothing close to balanced. We cannot tax our way out of the spending dilemma we’ve created. The American people know that Washington has a spending problem, not a taxing problem. We must dramatically cut spending. I opposed this bill because it raises taxes without any plan to reduce the deficit. It simply kicks the can further down the road and ensures the President will have another crack at taxpayers’ wallets while offering no substantive solutions to stop this spending crisis.

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