Obama Prepares to Jump the Cliff
Is President Obama willing to jump the “fiscal cliff,” as many of his supporters are hoping he will?
It depends on what your definition of “fiscal cliff” is.
The White House takes a limited view of the current budget and tax impasse, casting it as a short-term conflict over the automatic tax increases and spending cuts that are looming at the end of the year.
Defined that way, the president does seem willing to allow the across-the-board tax increases and spending cuts to kick in at the end of the year if House Republicans refuse to allow tax rates to go up for top earners.
Obama is treating the negotiations over tax rates and spending as a continuation of the debt-ceiling fight that created the automatic spending cuts in the first place.
Having won re-election and with current tax rates set to expire, Obama is looking to do a deal limited in scope to those issues. If Republicans would like to avoid automatic, long-term reductions in defense spending, Obama believes that the money should come from higher rates for top earners.