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| House Majority Leader Eric Cantor of Va. leaves a Republican caucus meeting on Capitol Hill in Washington, Tuesday, Jan. 1, 2013. Squarely in the spotlight, House Republicans began deciding their next move Tuesday after the Senate overwhelmingly approved compromise legislation negating a fiscal cliff of across-the-board tax increases and sweeping spending cuts to the Pentagon and other government agencies. Cantor says he opposed the Senate bill. |
WASHINGTON (AP) -- Emergency legislation to avoid the economy-threatening fiscal cliff ran into vehement New Year's Day opposition from House Republicans, casting doubt on the divided government's ability to prevent widespread tax increases and painful, across-the-board federal spending cuts.
"I do not support the bill. We
are looking, though, for the best path forward," House Majority Leader
Eric Cantor, R-Va., declared after a closed-door meeting of his party's
rank and file.
While Speaker John Boehner took
no public position, an attempt to add spending cuts was all but certain
before the leadership called for a final House vote on the measure that
cleared the Senate hours earlier in a pre-dawn vote of 89-8.
Any
change in the legislation would require the Senate to re-pass the
measure before it could go to President Barack Obama for his signature,
and his aides met at the White House to review the bill's prospects.
There
was no immediate response to the House Republicans from Senate Majority
Leader Harry Reid, D-Nev., or from Sen. Mitch McConnell of Kentucky,
the Republican leader who negotiated the final bill with Vice President
Joe Biden.
It wasn't the first time that the
tea party-infused House Republican majority has rebelled against the
party establishment since the GOP took control of the chamber 24 months
ago. But with the two-year term set to end Thursday at noon, it was
likely the last. And as was true in earlier cases of a threatened
default and government shutdown, the brinkmanship came on a matter of
economic urgency, leaving the party open to a public backlash if tax
increases do take effect on tens of millions.
Economists
have warned that without action by Congress, the tax increases and
spending cuts that technically took effect with the turn of the new year
at midnight could send the economy into recession.
The
Senate-passed bill was designed to prevent that while providing for tax
increases at upper incomes, as Obama campaigned for in his successful
bid for a second term.
It would also prevent
an expiration of extended unemployment benefits for an estimated two
million jobless, block a 27 percent cut in fees for doctors who treat
Medicare patients, stop a $900 pay increase for lawmakers from taking
effect in March and head off a threatened spike in milk prices.
At
the same time, it would stop $24 billion in spending cuts set to take
effect over the next two months, although only about half of that total
would be offset with spending reductions elsewhere in the budget.
The
non-partisan Congressional Budget Office said the measure would add
nearly $4 trillion over a decade to federal deficits, a calculation that
assumed taxes would otherwise have risen on taxpayers at all income
levels. There was little or no evident concern among Republicans on that
point, presumably because of their belief that tax cuts pay for
themselves by expanding economic growth and do not cause deficits to
rise.
The relative paucity of spending cuts
was a sticking point with many House Republicans. Among other items, the
extension of unemployment benefits costs $30 billion, and is not offset
by savings elsewhere.
"I personally hate it,"
said Rep. John Campbell of California. "The speaker the day after the
election said we would give on taxes and we have. But we wanted spending
cuts. This bill has spending increases. Are you kidding me? So we get
tax increases and spending increases? Come on."
Others
said unhappiness over spending outweighed fears that the financial
markets will plunge on Wednesday if the fiscal cliff hasn't been
averted.
"There's a concern about the markets,
but there's a bigger concern, which is getting this right, which is
something we haven't been very good at over the past two years," said
Rep. Steve LaTourette of Ohio.
House Democrats
met privately with Biden for their review of the measure, and the
party's leader, Rep. Nancy Pelosi of California, said afterward that
Boehner should permit a vote.
"That is what we expect. That is what the American people deserve," she said.
For
all the struggle involved in the legislation, even its passage would
merely clear the way for another round of controversy almost as soon as
the new Congress convenes.
With the Treasury
expected to need an expansion in borrowing authority by early spring,
and funding authority for most government programs set to expire in late
March, Republicans have made it clear they intend to use those events
as leverage with the administration to win savings from Medicare and
other government benefit programs.
McConnell said as much moments before the 2 a.m. Tuesday vote in the Senate - two hours after the advertised "cliff" deadline.
"We've
taken care of the revenue side of this debate. Now it's time to get
serious about reducing Washington's out-of-control spending," he said.
"That's a debate the American people want. It's the debate we'll have
next. And it's a debate Republicans are ready for."
The 89-8 vote in the Senate was unexpectedly lopsided.
Despite grumbling from liberals that Obama had given way too much in the bargaining, only two Democrats opposed the measure.
Among
the Republican supporters were Sen. Pat Toomey of Pennsylvania, an
ardent opponent of tax increases, as well as Sen. Ron Johnson of
Wisconsin, elected to his seat two years ago with tea party support.
It
marked the first time in two decades that Republicans willingly
supported higher taxes, in this case on incomes over $400,000 for
individuals and $450,000 for couples. Taxes also would rise on estates
greater than $5 million in size, and on capital gains and dividend
income made by the wealthy.
