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A group of Republican Senators, led by Minority Leader Mitch McConnell, is working on a plan to avert the fiscal cliff that would include increased tax rates on incomes above $250,000, according to The Washington Post.The approach would be a major shift for Republicans, who have staunchly opposed President Barack Obama’s plan to raise taxes on the top 2 per cent of Americans.
But there’s a catch. Republicans think they could “win” the fiscal cliff debate with this strategy — because if they cave on what has been the most important issue for Obama and Democrats, they will have greater leverage to move forward on more significant spending cuts. They also think it would preclude them from having to give in on tax increases on investments and capping some deductions, according to the report.
The Post reports that the strategy would raise only $440 billion in revenues, because Republicans would only concede on the rate increases for the top 2 per cent. That’s about $360 billion less than what House Speaker John Boehner has proposed raising. It’s nearly $1 trillion less than what Obama is proposing as a revenue target.
Boehner, according to the report, has so far rejected the proposal, along with other House Republican leaders.
But it’s clear that Republicans feel the need to do something to avert the cliff. Polls have consistently shown that they would be to blame if no deal is reached, and that voters “trust” and approve of Obama and Democrats more with the negotiations.