With just more than a month before the so-called “fiscal cliff” will force a plethora of new tax increases and spending cuts, the framework of a deal to avert the cliff is beginning to come together.
Politico’s Mike Allen and Jim VandeHei have some of the details this morning. Here’s what they report is starting to come together:
- Taxes are set to increase by $1.2 trillion, “the middle ground of what President Barack Obama wants and what Republicans say they could stomach.”
- Entitlement cuts, the bulk of which will come from Medicare, will come in at no less than $400 billion — “and perhaps a lot more.”
- All told, spending cuts and “war savings” will total about $1.2 trillion. The Congressional Budget Office estimated earlier this year that the savings from the end of wars in Iraq and Afghanistan would amount to about $440 billion.
Allen and VandeHei also report that there’s “no way” taxes are not going up on incomes above $250,000, a key component of Obama’s plan to any deal. Privately, Republicans know this. And it makes sense, given that recent polls are finding that even Republicans are moving to support the measure.
An interesting component of the preliminary framework is that Democrats are proposing to have the higher taxes kick in now — while the entitlement cuts will come anywhere from 10-20 years down the road.
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