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Senate Dem. Aide: "Fiscal Cliff" Deal Reached

11:48 PM, Dec 31, 2012   |    comments
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WASHINGTON -- The White House has reached a deal with Congress to avert the "fiscal cliff," according to officials familiar with the negotiations.

Vice President Joe Biden traveled to Capitol Hill late Monday to meet with Senate Democrats, including those who have expressed skepticism about proposed agreement struck with Republican leader Mitch McConnell.

The deal came together hours after President Obama said that Congress was making progress on a short-term "fiscal cliff" deal, but it is increasingly clear as a midnight deadline approaches that Washington will have to fix the impending tax hikes and spending cuts retroactively.

Elon political science professor Jason Husser said, "If I were a Democrat right now, I'd be happier than if I were a Republican. It seems like the Republicans gave up more."

Vice President Joe Biden was scheduled to meet at 9:15 p.m. with Senate Democrats. A Senate vote late Monday has not been ruled out, but it appeared unlikely. House Republicans advised members Monday afternoon that no votes were expected on a final deal tonight, but cautioned that the situation is "very fluid."

Negotiators have signed off on the provisions of a deal affecting tax rates, according to Senate Minority Leader Mitch McConnell, R-Ky., but an ongoing dispute over how and whether to turn off impending spending cuts remains a hurdle.

"We're very, very close to an agreement," said McConnell, who suggested that Congress may have to move forward with a vote on just the tax portion of an agreement to reassure Americans while Congress continues to fight over spending cuts. "Let's take what's been agreed to and get moving," he said.

Negotiations have narrowed to a Democratic offer to pay for the spending cuts for two months, estimated to cost $24 billion, a McConnell spokesman said. Republicans want additional cuts to make up for supplanting those cuts and have sent Democrats a list outlining $130 billion of suggested cuts for Democrats to consider.

Senators were awaiting guidance from Senate Majority Leader Harry Reid, D-Nev., on whether a deal could be reached tonight. However, a vote on any potential deal seemed unlikely before midnight as the negotiations entered the early evening hours.

An agreement to prevent a New Year's tax hike "is within sight -- but it's not done," Obama told an audience of cheering supporters at a White House event. Without providing specific details, Obama said the proposal would help reduce the nation's $16 trillion-plus debt through higher taxes on the wealthy. He said it would also extend unemployment insurance and preserve tax credits for such middle class items as child care and education.

"There are still issues left to resolve but we're hopeful Congress can get it done," Obama said at a campaign-style event that chafed congressional Republicans. Obama's 2008 presidential rival Sen. John McCain, R-Ariz., criticized it as "a cheerleading, ridiculing-of-Republicans exercise."

According to officials familiar with the talks, there is consensus to allow the George W. Bush-era rates to expire for individuals earning above $400,000 and joint filers above $450,000. Negotiators have also agreed to an increase in the estate tax rate from 35% to 40% on inheritances over $5 million.

The president said he would have preferred a bigger debt reduction deal, but congressional Republicans balked and now it will have to be done "in stages." Down the line, Obama said he will continue to insist that debt reduction be balanced with revenues as well as spending cuts, foreshadowing a second term defined by budgetary clashes with Republicans.

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