Dems Hatch a Hail Mary Plan to Avert Fiscal Cliff
Business + Economy

Dems Hatch a Hail Mary Plan to Avert Fiscal Cliff


Democrats in the U.S. House of Representatives on Friday announced a longshot bid to force an early vote on tax hikes to break the stalemate in negotiations over the year-end "fiscal cliff."

The Democratic plan, which Senate Minority Leader Nancy Pelosi said could begin on Tuesday, involves getting a majority of the Republican-controlled House to sign a petition scheduling a vote over the objection of the Republican leadership. Such a procedure, called a "discharge petition," might generate considerable publicity, fire up Democrats and anger Republicans.

But to actually work, Democrats, who hold 192 seats in the Republican-controlled House, would have to attract to their cause 25 or 26 Republicans. It is unlikely that so many Republicans would break ranks and deliver a powerful rebuke to Speaker John Boehner, the gatekeeper of the legislative process.

The central question dividing Washington is whether to extend lower tax rates for everyone, as Republicans want, or just for middle-income taxpayers as Democrats want. The tax cuts expire December 31, just as automatic across-the-board cuts in federal spending take effect. The simultaneous jolt of this so-called fiscal cliff has the potential to bring on a new recession, according to the Congressional Budget Office.

The Democratic-controlled Senate passed a bill during the summer on a mostly party-line vote that would extend the reduced tax rates for everyone but the wealthy. House Republican leaders have refused to permit a vote on the measure, saying it amounts to "class warfare" that would hurt job creators and the economy.

Pelosi announced on Friday that unless Republicans schedule a vote on the stalled bill, she will offer a petition on Tuesday. "We need some Republicans who support middle income tax cuts to sign on with us," Pelosi said. She said if the petition prevails, she believes the bill could "get a 100 percent vote" on the House floor. "Who is going to vote against a tax cut for the middle class? No one," a Democratic aide said.

In recent days, a number of House Republicans have said they would be willing to accept some sort of tax hike on the wealthy to secure a bipartisan deficit reduction deal.  But such utterances are a far cry from defying their party's leadership in an effort that rarely succeeds.

A Republican leadership aide predicted Democrats would fall short.

"The president and Democratic leaders should focus on finding serious solutions, rather than wasting time on ridiculous proposals and attempts to punish small business owners, which won't help the economy or create one single job," the aide said.
Additional reporting by David Lawder