The nonpartisan Congressional Budget Office released a new study Tuesday reporting that the economy will shrink 1.3 percent in the first half of next year if the government is allowed to fall off the so-called “fiscal cliff” on January 1: allowing Bush-era tax cuts to expire and sheduled round of automatic spending cuts. Republican House Speaker John Boehner has been vocal in recent weeks begging Democrats to come to the table to tackle the debt ceiling part of the problem now rather than after the election in November. Democratic Senate Majority Leader Harry Reid has been cold on that idea though, reinforcing Tuesday that Senate Democrats will not even consider extending the tax cuts until after the fall elections. The Washington Examiner reports on Reid’s confusing response to Republicans interested in moving forward on dealing with the fiscal cliff:
Senate Majority Leader Harry Reid, D-Nev., wrote to Republicans Tuesday, accusing them of caring only about “tax breaks for multimillionaires.”Reid didn’t directly address the need for the tax cuts, but ripped Republicans for refusing to consider a deficit-cutting plan that would increase taxes in addition to further slashing spending.“Unfortunately, it appears the that the Republicans’ blind adherence to Tea Party extremism is making it impossible to reach this sort of balanced agreement before the election,” Reid wrote.
On “Real News” Wednesday, the panel was joined by James Otteson of Yeshiva University to discuss how dire the situation is regarding the fiscal cliff, and what can be done on Capitol Hill to deal with the situation. Watch a clip from Wednesday’s show: