Somerset —
In the end, while the majority of House Republicans didn’t go along with the Democrat-favored plan to avert the so-called “fiscal cliff,” enough of them did to get the deal done.
The plan that was passed late Tuesday night achieved President Barack Obama’s goal of allowing taxes on the highest income bracket to rise from 35 percent back to the Bill Clinton-era level, 39.6 percent. Likewise, the significant cuts to government spending sought by Republicans weren’t ultimately included — the $109 billion worth of across-the-board cuts that would have accompanied an inability to reach a deal are delayed,
While 151 House Republicans voted against it, 85 voted for the deal which was seen as a bipartisan compromise by many, enough to pass the bill by a 257-167 count after the Senate approved it 89-8 less than 24 hours earlier.
Somerset’s own Congressman Harold “Hal” Rogers was one of those in the GOP to vote yes. Despite the deal proving controversial among his fellow party members, Rogers stressed the need for immediate action, even though he didn’t sound happy about all of the legislation’s details either.
“The fiscal cliff deal requires much more work, but the good news is it saves nearly all Kentuckians from an immediate tax hike,” said Rogers in a statement Wednesday. “While the White House refuses to address our nation’s overspending and $16 trillion national debt, this Congress must stand firm on fiscal responsibility and hold the president to his promise for a "balanced" approach.
As chairman of the House Appropriations Committee, Rogers has touted his work over the last couple of years reducing government spending. He took that mindset when considering the plan that was just passed.
“Our nation's problem is not that we tax too little, it is we spend too much,” said Rogers. “While we avert many tax hikes tomorrow, the reality is that the fiscal cliff just got steeper. This deal is void of vital spending cuts and I can only hope the same bi-partisan spirit will carry on as we shift our focus to paying down our debt and reducing our deficit through meaningful reform.”
Without a deal, it wouldn’t have just been the wealthy to see their taxes go up. The plan extended the “Bush tax cuts” on incomes up to $400,000 for individuals, $450,000 for couples. Earnings above those amounts would be taxed at a rate of 39.6 percent, up from the current 35 percent. Extends Clinton-era caps on itemized deductions and the phase-out of the personal exemption for individuals making more than $250,000 and couples earning more than $300,000.
Estates would be taxed at a top rate of 40 percent, with the first $5 million in value exempted for individual estates and $10 million for family estates. In 2012, such estates were subject to a top rate of 35 percent. Taxes on capital gains and dividend income exceeding $400,000 for individuals and $450,000 for families would increase from 15 percent to 20 percent.
Additionally, the deal extends for five years Obama-sought expansions of the child tax credit, the earned income tax credit, and an up-to-$2,500 tax credit for college tuition. Also extends for one year accelerated "bonus" depreciation of business investments in new property and equipment, a tax credit for research and development costs and a tax credit for renewable energy such as wind-generated electricity.
The measure split the upper ranks of the Republican leadership in the House.
Speaker John Boehner of Ohio voted in favor, while Majority Leader Eric Cantor of Virginia and California Rep. Kevin McCarthy, the party's whip, opposed the bill. Rep. Paul Ryan of Wisconsin, the party's 2012 vice presidential candidate, supported the measure.
Already, both sides were maneuvering for the next round in a seemingly ceaseless struggle about taxes and spending.
In a statement after the vote, Boehner said, "Now the focus turns to spending. The American people re-elected a Republican majority in the House, and we will use it in 2013 to hold the president accountable for the 'balanced' approach he promised, meaning significant spending cuts and reforms to the entitlement programs that are driving our country deeper and deeper into debt."
Sen. Mitch McConnell, the Senate Republican Leader, was the key negotiator in the other body of Congress. In his remarks on the Senate floor, McConnell said that “ the President wanted tax increases, but thanks to this imperfect agreement, 99 percent of my constituents won’t be hit by those hikes. So it took an imperfect solution to prevent our constituents from very real financial pain. But in my view, it was worth the effort.
“As I said, this shouldn’t be the model for how to do things around here,” he added. “But I think we can say we’ve done some good for the country. 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. 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 Associated Press contributed to this story
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