Senate aide on fiscal cliff: ‘It’s hard to overstate how little is going on’

Jamie Weinstein | Senior Writer

As the focus to prevent the United States from falling off the so-called fiscal cliff turns to the Senate, a top Democratic aide tells the New York Times that not much is really going on there.

“It’s hard to overstate how little is going on,” the aide, described by the Times as “a senior Democratic leadership aide,” said. The aide also told the Times that senators were admitting in private that they do not expect a deal to be reached before $600 billion dollars worth of tax increases and spending cuts automatically kick in at the beginning of 2013.

But senators are not only admitting as much in private.

Independent Connecticut Sen. Joe Lieberman told CNN’s “State of the Union” Sunday that he now believes that no deal will be reached in time to avoid the fiscal cliff.

“It’s the first time that I feel it’s more likely that we will go over the cliff than not,” he said, as reported by CNBC.

“If we allow that to happen it will be the most colossal consequential act of congressional irresponsibility in a long time, maybe ever in American history.”

Republican Wyoming Sen. John Barrasso said on Fox News Sunday that not only did he think that there would be no deal to avert the fiscal cliff, but that he believed that President Barack Obama wants to go over it.

“I think the president is eager to go over the cliff for political purposes. I think he sees a political victory at the bottom of the cliff,” he said.

With talks between himself and President Obama stalled, House Speaker John Boehner sought to pass his “Plan B” through the House last week, which would have kept the Bush tax rates for everyone making under $1 million a year in place. He ultimately abandoned the plan when it became clear he did not have enough support within the Republican caucus to pass it.

On Friday, the day after Boehner’s very public failure, Obama gave a short statement before heading to Hawaii for the Christmas holiday, calling on Congress to work toward a smaller deal to avert the fiscal cliff.

“In the next few days, I’ve asked leaders of Congress to work towards a package that prevents a tax hike on middle-class Americans, protects unemployment insurance for 2 million Americans, and lays the groundwork for further work on both growth and deficit reduction,” he said. “That’s an achievable goal. That can get done in 10 days.”

But with the focus now on the Senate, the New York Times reports that Democrats will only put forth legislation if they can be guaranteed by Minority Leader Mitch McConnell that the bill won’t be filibustered by Republicans and that Boehner will bring it to a vote in the House when passed.

A spokesman for McConnell, Don Stewart, told the Times that McConnell didn’t have the power to unilaterally declare that no filibuster would occur. He added that the ball was now in Senate Majority Leader Harry Reid’s court to propose something.

“Reid is the majority leader. Maybe for once he could propose something that he actually thinks could pass,” he said.

But according Republican Tennessee Sen. Bob Corker, the proverbial ball doesn’t seem to be going anywhere.

“The ball is not moving along,” he told the Times.

The Senate is expected to be called back into session on Thursday.

Meanwhile, agencies slated to be affected by the fiscal cliff are reportedly not planning on making any major changes as of yet, according to the Huffington Post.

According to the report by the liberal media outlet, the affected agencies believe that negotiations between Congress and the White House will continue after the New Year — if a deal is not reached before the so-called cliff — until a deal is ultimately reached.

For instance, Secretary of Defense Leon Panetta recently announced that the Pentagon planned no major layoffs, the Huffington Post reported.

Energy Secretary Steven Chu issued a similar statement.

“I do not expect our day-to-day operations to change dramatically on or immediately after January 2, should sequestration occur,” Chu wrote in an email to his staff, according to the Huffington Post. “This means that we will not be executing any immediate personnel actions, such as furloughs, on that date.”

But while government agencies may be taking the prospect of going over the fiscal cliff in such a blasé manner, it is unclear how financial markets would react.

“The truth of the matter is, if we do fall off the cliff after the president is inaugurated, he’ll come back, propose just what he proposed yesterday in leaving Washington, and we’ll end up adopting it,” Georgia Republican Sen. Johnny Isakson said on ABC’s “This Week” Sunday. “But why should we put the markets in such turmoil and the people in such misunderstanding or lack of confidence?”

President of the American Chamber of Commerce in Hong Kong, Dr. Richard Vuylsteke, told The Daily Caller last month that a failure to come to a deal would also hurt the confidence of those around the world in the United States.

“We can’t afford to fall off this cliff,” he said. “If we do, I mean, the ripple effect — immediately it’s a big splash to begin with — but its ripple effect long-term is it’s going to really impact confidence from abroad [of] the United States.”

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