Fiscal cliff campaign rages
WASHINGTON — The election may be over, but a new campaign is being waged in the nation’s capital as lobbyists, advocates and trade groups fight to shape the government’s response to the looming fiscal cliff.
But this time, the effort is directed at politicians, not so much the public.
Lobbyists and advocacy groups are mainly trying to control the damage as Congress and the White House look to raise taxes and cut spending in an attempt to slow down the government’s mushrooming debt. In other words: Don’t raise my taxes and don’t cut spending on programs I like.
At the same time, cheerleaders for fiscal austerity, including members of President Barack Obama’s own deficit commission, are lobbying him and Congress to cut deficits. In 2010, the commission proposed a plan that mixed tax increases and spending cuts to reduce government borrowing by almost $4 trillion over the next decade.
Obama largely ignored that plan. Now, the two co-chairmen of the commission, Democrat Erskine Bowles and Republican Alan Simpson, have formed a group called Fix the Debt that is running newspaper ads urging a solution.
Come January, the nation faces a massive combination of automatic tax increases and across-the-board spending cuts that have come to be known as the “fiscal cliff” because allowing this scenario to play out would probably send the economy back into recession, according to government economists.
Lawmakers and the White House are working in a postelection session of Congress to reduce the sudden jolt of higher taxes and spending cuts and lay a framework for addressing the nation’s long-term financial problems. But the two political parties are struggling to find common ground.
Obama wants to let tax rates rise for wealthy families while sparing middle- and low-income taxpayers. Some Republican leaders, including House Speaker John Boehner of Ohio, have said they are willing to consider making the wealthy pay more by reducing their tax breaks. But most Republicans in Congress adamantly oppose raising tax rates.
Advocates for older people are warning the negotiators to keep their hands off Social Security, Medicare and Medicaid.
The defense industry is fighting against spending cuts that would bite weapons makers. The National Association of Manufacturers warns that 1 million private-sector jobs could be lost in pending cuts to military spending.