House Republicans are resolutely opposing new tax increases to head off $85 billion in across-the-board spending reductions, but ensuring the cuts will go into force March 1 and probably remain in place for months, if not longer.
Despite new calls from the White House to enact a combination of tax increases and cuts to postpone the so-called sequester, the House is moving forward on a legislative agenda that assumes deep and arbitrary cuts to defense and domestic programs. These will remain in place through the end of the year.
Congressional Republicans have relented in the most recent fiscal showdowns, but lawmakers say they have no intention of surrendering in this one even though President Obama has raised the potential of widespread disruptions in government services and even military operations in the weeks ahead. The president’s January fiscal victory, which yielded increases in income, capital gains and dividend tax rates on affluent families, has only bolstered Republican resolve.
House Republicans say they believe they are responsible for approving measures last year that would have substituted reductions in government programs. Party strategists have advised Republican members to aggressively blame the president for the creation of the automatic cuts and the failure to stop them.
The House Appropriations Committee will introduce legislation to keep the government financed through September 30, the end of the fiscal year. This will be to avoid a full government shutdown end of March, but nothing to stop the pending cuts.
In the last showdowns won by the president, inaction was seen as intolerable. If the Republicans had done nothing in 2011, a temporary payroll tax would have lapsed without offsetting tax cuts. Had the Republicans not relented and let some taxes rise, on January 1, every tax cut of the Bush administration would have expired.
The Democratic Congressional Campaign Committee will begin an offensive; accusing Republicans of risking 700,000 jobs to protect “special interest tax loopholes” that Democrats say can be closed to mitigate the impact.
The Senate will consider competing Democratic and Republican proposals to stop the automatic cuts. The Democratic plan would institute a 30 percent minimum tax rate on incomes over $1 million, cut farm subsidies, and institute military cuts delayed until most United States troops have returned from Afghanistan. Neither plan is expected to win the 60 votes needed to overcome a filibuster.
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