Fiscal cliff: Three possible scenarios Democrats may pursue
December 21st, 2012
01:39 PM ET
1 year ago

Fiscal cliff: Three possible scenarios Democrats may pursue

Washington (CNN) - House Speaker John Boehner and President Barack Obama insist they're not giving up on the - currently stalled - one-on-one talks to avert the fiscal cliff, but regardless, sources in both parties now believe that with Boehner's Plan B having bombed, the next move will now start in the Senate.

A senior Democratic Senate source laid out three scenarios Democrats in the Senate are considering: either go over the cliff; push for a fall back measure, an alternative to going over the cliff; or push for a broad deal, such as the deal Obama offered Boehner last weekend, which Democrats said included $2 trillion in tax increases and spending cuts.

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More on the thinking behind each possibility, from the senior Democratic Senate source:

1) Go over the cliff – When the new Congress convenes on January 3rd, Democrats will have more seats - and they see themselves having a stronger hand. If we go off the cliff December 31st, the markets don't open again until Wednesday January 2nd. Yes – the move could produce a bad psychological reaction, but the hope would be to correct that by passing a deal as soon as the new Congress is sworn in on January 3rd.

In this scenario, the politics of the vote in the new year would be much easier because the politics of the tax vote would be turned on its head: instead of voting to raise taxes, the vote will be to cut taxes, since the Bush era tax cuts will have already expired at the end of 2012.

Democrats will have 55 votes in the Senate, and would only need 5 Republicans to cross party lines and back their measure. The Democratic hope in this scenario is that the pressure on Senate Republicans would be so intense that it would be hard for at least five GOP Senators to vote no on any package that includes keeping taxes low for the middle class, as well as other important elements.

2) Fallback scenario – The Senate would take the bill it already passed earlier this year to keep Bush tax cuts in place for households with income below $250,000, and add other important items which will include sweeteners for Republicans, including the alternative minimum tax (AMT) fix, "doc fix" (delay in payments to Medicare providers), and estate tax extension at current rate.

This would be harder for Senate Democrats to pass since they will need seven or eight Republicans in the current Congress to cross party lines. The Democratic source said this would entirely depend on whether Senate Republican Leader Harry Reid and Obama could line those GOP votes up. They also want to be sure whatever they pass could also pass the House. What Reid is privately telling people is that he does not intend to have Senate Democrats take a tough vote that will go nowhere in the House.

3) Pass big package - The Senate would take the latest offer from President Obama to Boehner with tax increases on household income over $400,000 and the spending cuts he proposed, or something close to it, and turn it into a piece of legislation and try to pass it, the Democratic source suggested. Again, the same political imperative for the fall back scenario would apply to this – Senate Democrats would have to be sure they could get enough Republicans, seven or eight, to cross over and pass this. They also want to be sure it pass the House before going this route.

Needless to say, options two and three would have to be done sometime next week after Christmas. The window is small – just a few days.


Filed under: Fiscal Cliff • Senate Democrats
soundoff (34 Responses)
  1. J'Cincinnati'Redd

    2007 the GOP, was down for the count. we had no answers.And then a beautiful thing happen,the tea party! They had a loud message they showed no fear,and they had passion. I respect the tea party for giving us that boost. But now its 2013 OBAMA, won and we have to move on. we still could use you guys but not sevring in the house. Nobody cant get everything they want all the time.but if u ask a 2yr old That question they would say, why cant I?

    December 21, 2012 02:52 pm at 2:52 pm |
  2. Rudy NYC

    Republicans looking like the guilty party right now, and Democrats have looked like the adults.

    HOUSE: Democrats cannot bring any bills to the floor without Boehner approving it because they control everything. Boehner announces he's bring a bill to the floor and withdraws it.

    SENATE: Democrats control everything, but they allow a vote on McConnell's bill....and McConnell filibusters his own bill.

    Republicans are looking like the keystone cops right about now, and there'e nothing funny about it.

    December 21, 2012 02:56 pm at 2:56 pm |
  3. George Fatula Jr

    You know Congress is failing the American people. Here is another example of failure, the fiscal cliff as they call it. They have forgotten who put them in office and who they work for. It's time we the people take back our government and put in place term limits for congress.
    Here we have Congress members who are either wealthy or well off and seem to not care about the majority of American people who are living paycheck to paycheck.
    We have old members out of touch with America and young members trying to make a name for themselves and what we have is fighting among Congress members.
    It's time for term limits. I propose a 3 term, term limit.
    This should help clean up Congress and curb money being paid from special interests groups to get their way.
    Please, let's start a dialog on term limits.

    December 21, 2012 02:59 pm at 2:59 pm |
  4. Dara

    Yep for Plan 1. Let the tax cuts expire.

    December 21, 2012 02:59 pm at 2:59 pm |
  5. George Fatula Jr

    You know Congress is failing the American people. Here is another example of failure, the fiscal cliff as they call it. They have forgotten who put them in office and who they work for. It's time we the people take back our government and put in place term limits for congress.
    Here we have Congress members who are either wealthy or well off and seem to not care about the majority of American people who are living paycheck to paycheck.
    We have old members out of touch with America and young members trying to make a name for themselves and what we have is fighting among Congress members.
    There is a reason why we have term limits for the President. We don't want a dictator. Well Congress has become a dictatorship and a do nothing Congress.
    It's time for term limits. I propose a 3 term, term limit.
    This should help clean up Congress and curb money being paid from special interests groups to get their way.
    Please, let's start a dialog on term limits.

    December 21, 2012 03:13 pm at 3:13 pm |
  6. K. in Miami

    It is absolutely mind boggling that average everyday Republicans support the Republicans/Tea Party elected legislators, when a political party is driven by Hatred and Spitefulness they become PREDICTABLE.....

    Is it really in the best interest of the general public, and this includes average everyday people, and some I might add that are Republican to be motivated by the Hatred and opposition to The President of The United States of America (Barrack Obama)....

    I think we all know the answer to this question, the thing that makes it mind boggling is why do the average everyday White Person support these Republicans, ofcourse we have to be honest as well and just admit that Tribal Tendencys and Racial Integrity is the bone chilling truth of the matter, sad......really really sad to be an American in light of what the country has to endure because a segment of our society is driven by Racial Hatred of the POTUS....!

    December 21, 2012 03:21 pm at 3:21 pm |
  7. Name lynn

    put the bat signal out an tell batman to capture john boehner an hold him until obama republicans an democrates make the right choices when it comes for everybody to paid higher taxes

    December 21, 2012 03:29 pm at 3:29 pm |
  8. Floyd from Illinois

    I don't see how this ends in anything other than a hosing for the GOP.

    December 21, 2012 03:39 pm at 3:39 pm |
  9. eric

    Hi Ed,

    Only 47% of the country agrees with you.

    December 21, 2012 03:40 pm at 3:40 pm |
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