WASHINGTON — Now that House Speaker John Boehner’s Plan B for addressing the fiscal cliff has crashed and burned, the top US Republican appears to have two remaining options – wash his hands of the entire matter or negotiate a compromise with Democrats that could abandon scores of his fellow Republicans.
The Republican rank and file and Democrats may face an equally stark choice: work together for a change, or plunge together off the cliff.
Boehner tried to ram a fallback plan through the House yesterday – a relatively tiny tax increase on millionaires and billionaires – and failed. His rambunctious Republicans, who see opposition to all tax hikes as a matter of bedrock principle and of political survival, refused to go along.
President Barack Obama and his Democrats who control the Senate take the opposite view – tax hikes on the wealthy are a condition for their support of a fiscal cliff bill. If there is to be a resolution it will largely depend on an improbable scenario – Democrats in the House teaming up with less militant Republicans to back away from the fiscal cliff.
Compromise has been out of style in recent years, and many think it could require some prodding from the markets.
“At this point, I only see one route to avoiding the cliff, a replay of the TARP debacle in 2008,” said George Washington University’s Sarah Binder, an expert on Congress. In September 2008, the House defeated the bank bailout bill and the market collapsed, prompting a terrified lawmakers to reconsider and pass it.
“In this case, a harsh market and public reaction would be needed to force the hand of the speaker to negotiate a deal that can pass with Democratic votes,” she said.
For the time being – or at least the 11 days until the automatic tax hikes and spending cuts are triggered – the House is in disarray and no deal to avert the fiscal cliff is in sight.
While the House in recess for a Christmas break that is likely to last at least until December 27, Boehner must decide whether to move any further in Obama’s direction and agree to tax increases much higher than his own proposal that so angered his fellow Republicans on Thursday.
The Ohio Republican also might have to settle for fewer long-term spending cuts than he had hoped for. (Reuters)