Harry Reid: Tax Deal Unlikely Before Elections
Senate Majority Leader Harry Reid (D-Nev.) indicated that he does not see a way to reach bipartisan agreement on deficit reduction or taxes before the November elections.
Reid, in a terse letter, was responding to a letter signed by 41 Senate Republicans that demanded immediate action on extending Bush-era tax cuts that expire at the end of this year.
In his letter, Reid suggested that the GOP Senators’ concerns were not legitimate unless they agreed to compromise on a deficit reduction package that includes tax increases on the wealthy and corporations.
“Unfortunately, it appears that Republicans’ blind adherence to Tea Party extremism is making it impossible to reach this sort of balanced agreement before the election,” Reid wrote.
Reid also attacked Republicans for characterizing last summer’s budget and debt deal as a failure of the “administration” and not of Republicans and Democrats alike. Reid points out that many of the signatories voted for the deal, which mandated deep spending cuts from defense and other domestic programs if a compromise deficit reduction deal were not reached. Those cuts, which are set to take effect in January 2013, are known as the sequester.
“Thank you for your May 17 letter on fiscal policy, in which you complain of ‘budget cuts from the sequester,’” Reid wrote. “The American people want a balanced approach to fiscal policy that combines smart spending cuts with revenue measures that ask millionaires and big corporations to pay their fair share. Yet a strict adherence to Tea Party ideology among Republicans in both the House and the Senate has so far put that balanced, common-sense solution out of reach.”
He continued, “Once Republicans are willing to abandon their commitment to more tax breaks for multi-millionaires and special interests and their plans to end Medicare, I am confident that we can reach an agreement.”
The exchange of letters comes at a time when leaders have renewed focus on the work that needs to be done before 2013. In a likely lame-duck session after the election, Congress is expected to tackle the Bush-era tax cuts, the sequester and, possibly, another debt ceiling increase.
In their letter last week, Republicans expressed a desire to work on these issues before the elections, a scenario neither party believes will play out for political reasons. Both the Senate and the White House could be up for grabs in November. Many, however, have viewed the magnitude of the work being left for the lame-duck session as too significant to wait to address in full at the end of the year.
“If Congress and the President do not act by the end of this year, American taxpayers will face $310 billion in tax increases next year. This would be, without any exaggeration, the largest tax increase in American history,” the GOP Senators wrote in their letter. “The failure to extend the expiring tax relief — tax relief previously supported by President Obama — would hit all taxpayers, undermine small businesses, and be a dangerous drag on the economy.”