Next president faces daunting fiscal cliff

Published: Monday, November 05, 2012 @ 9:10 PM
Updated: Monday, November 05, 2012 @ 9:10 PM

Today, Americans will vote. On Wednesday, they will begin to face a grim reality.

No matter if President Barack Obama or Republican Mitt Romney wins the presidency, a crushing blend of tax increases and automatic spending cuts will go into effect at the end of the year unless Congress acts in the next two months.

To many financial analyst and economists, the automatic trigger of tax increases and spending cuts could deliver a lethal blow to the fragile U.S. economy. The non-partisan Congressional Budget Office calculates the economy next year would tip into a recession.

Yet despite anguished pleas from some of the nation’s top business executives, the institutionalized intransigence on Capitol Hill is prompting fears that lawmakers will be unable to put aside their deep divisions on taxes and federal spending and forge a bipartisan agreement.

Because of the Dec. 31 deadline, a lame duck Congress would need to approve a plan to prevent or delay the tax increases and budget cuts. And because most analysts believe Republicans will hold the House and Democrats keep the Senate, the same cast of characters will be arguing over the same set of issues when the new Congress is seated in January.

“If you have a status quo election, I am fairly pessimistic it can be resolved because there is a high degree of mistrust among congressional Republicans with President Obama,’’ said Ted Hollingsworth, a lobbyist in Washington and onetime chief of staff to former Sen. George V. Voinovich, R-Ohio.

“If you have a Republican sweep, I still think it’s fairly difficult (because) these are problems that have to be solved in a bipartisan way. The magnitude of our fiscal problems are such that they have to be solved in a bipartisan way and we are very, very far away from Republicans and Democrats even agreeing on the perimeters of a deal.’’

All the 2001 and 2003 income and investment tax cuts expire on Dec. 31,, which means that without congressional action, every American who pays income taxes will have a tax increase.

Then in the new year, the first of $1.2 trillion in automatic spending reductions will start going into effect. And while those reductions are spread out over the next decade, it means the federal government will be raising taxes and cutting spending as the economy continues to sputter.

Publicly, some lawmakers are hopeful. Sen. Sherrod Brown, D-Ohio, said “we have to do something immediately after the election to basically soothe the markets so they know we will do something serious after the first of the year on a balanced plan.’’

During a campaign trip to Ohio, Sen. John McCain, R-Ariz., predicted that if Romney wins, he will ask Congress to delay the tax increases and spending cuts for a few months while he organizes his new administration.

McCain said if Obama wins “we will try to get something done right away in the lame duck.’’ But McCain warned that if business executives conclude that Congress cannot produce a plan, then “the markets are going to go down’’ and the economy could tip into recession.

“So I believe that the chances of getting something done are good only because the alternative is so unacceptable,’’ McCain said.

During the debates, Obama said flatly that the automatic trigger will not happen.

The chasm between the two parties is vast, however. Democrats adamantly oppose deep reductions in the future growth rate of the programs that largely cause the deficit — Medicare, which pays health costs for the elderly; Medicaid, which provides health coverage for low-income Americans, and Social Security.

By contrast, Republicans want to dramatically reduce federal spending and extend all the 2001 and 2003 tax cuts. Obama and most Democrats have rejected that approach, insisting that the 2001 and 2003 tax reductions expire for families earning more than $250,000 a year.

Neither party’s approach leads to a balanced budget any time soon. The CBO has calculated that if even if all the 2001 and 2003 tax cuts expire at the end of the year, the government will add another $3 trillion during the next decade to the government’s publicly held debt — treasury bills held by private and public investors.

“Both sides are messaging to polling and not to reality,’’ said former Republican congressman David L. Hobson, R-Springfield. “The reality is there is not enough money in the rich to do this thing. And the other reality is you are going to have more revenue even as you cut spending. Because you will have to cut spending.’’

To many Democrats, the Republicans’ refusal to countenance higher income taxes on wealthier families is the major impediment to a deal. James Manley, a former top aide to Senate Majority Leader Harry Reid, D-Nev., said that if Obama is re-elected, the White House should hold firm on higher taxes for the wealthy — even if it means going over the fiscal cliff.

“The only way to get something done is to push to the limits,’’ Manley said. “The only way to fix our fiscal mess is to let everything expire and spend the first couple of months trying to deal with it all,’’ adding that “cliff jumping is the way to go.’’

Manley said that “hyper-partisanship still rules Washington and that will not change any time soon. Under this scenario, the Democrats and the president will have the upper hand because of the Republican all-consuming desire to keep the tax cuts for the wealthy.’’

Pointing out that the most drastic spending reductions do not go into effect until much later, Manley said, “There is a whole train of thought that this cliff is not really a cliff, it’s more of a falling slope.’’

Others reject such a strategy. Sen. Rob Portman, R-Ohio, said lawmakers should not “consider that option,’’ saying “it would be totally unacceptable to allow the country to go into a recession which is what most people believe will happen if we go off the fiscal cliff.’’

Instead, said Portman: “We should figure out a way to avoid the tax increases by postponing (them) for six months during which time we would put together serious tax reform,’’ in which income tax rates would be reduced while deductions and preferences are scrubbed from the tax code or capped in value.

On the automatic spending cuts scheduled for the next decade, Portman wants lawmakers to “come up with the savings that are necessary for this next calendar year. Portman said Congress would then have time to produce a mega-bargain by July — a package including tax reform and changes in Medicare and Medicaid.

What is beyond dispute is that the nation’s growing debt cannot be solved by one party. Unless lawmakers in both parties are willing to compromise, the U.S. debt will spiral out of control.

“At some point, the people who are so rigid in their view have to learn that you need to govern,’’ Hobson said. “It doesn’t mean you have to give up principle. But it does mean you have to learn to govern.’’

Joe Hallett of the Columbus Dispatch contributed to this story.

Few public answers to puzzle in Congressional IT investigation

Published: Saturday, May 27, 2017 @ 8:00 AM
Updated: Saturday, May 27, 2017 @ 8:00 AM

An inquiry into possible wrongdoing by IT staffers employed by a number of Democrats in Congress has garnered more attention in recent days, after a prominent lawmaker gave a public tongue lashing to the Capitol Hill police chief, vowing “consequences” over his refusal to return computer equipment that is evidently part of the ongoing investigation.

At issue is a probe into a possible security breach involving Imran Awan, who has worked for Rep. Debbie Wasserman Schultz (D-FL) and other Democratic lawmakers, as a shared information technology worker.

Little has been made public by Capitol Police on what exactly is being investigated; news reports in recent months have linked Awan, several of his relatives, and his wife to some type of Capitol Hill investigation that could involve stolen property and more.

The new scrutiny came after a budget hearing on May 18 with U.S. Capitol Police Chief Matthew Verderosa; the hearing before a House Appropriations subcommittee had escaped notice, until reports earlier this week by the Daily Caller, noting the sharp words that Wasserman Schultz had for Verderosa.

At the end of her Q&A with the police chief, Wasserman Schultz asks what happens when police find lost items.

“I’d like to know how Capitol Police handle equipment that belongs to a member, or a staffer, that’s been lost within the Capitol complex, and found or recovered by one of your officers,” Wasserman Schultz begins.

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The bottom line from the chief was simple – until an investigation is completed, “I can’t return the equipment,” which is reportedly a laptop from Wasserman Schultz’s office.

That answer did not satisfy the Florida Democrat.

“I think you’re violating the rules when you conduct your business that way,” Wasserman Schultz said bluntly, as she told the chief that he should “expect that there will be consequences.”

In the wake of that somewhat jarring verbal exchange, a reporter on Thursday asked House Democratic Leader Nancy Pelosi about the Awan investigation.

“I’m really not familiar with what you’re talking about,” Pelosi said.

“We’ve been busy with a lot of other things,” Pelosi added.

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U.S. Capitol Police have released little information about what this probe involves, and who exactly is being investigated.

According to U.S. House spending records, Imran Awan was a shared employee for thirteen different House members in 2016, earning in the third quarter anywhere from as little as $300 from a pair of Democrats to $6,624.99 from another.

Wasserman Schultz paid Awan $5,000.01 for work between July 1 and September 30, 2016.

Awan’s wife, Hina Alvi, worked for seven Democrats, plus the House Democratic Caucus, earning close to $44,000 in the third quarter of 2016.

Records also show two relatives of Awan’s on the Congressional payroll: Abid Awan worked for eight different House Democrats, while Jamal Awan worked for eight others – all as ‘shared’ employees.

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Kasich touts book, weighs in on Trump, Nixon, faith, media

Published: Friday, May 26, 2017 @ 4:02 PM
Updated: Friday, May 26, 2017 @ 4:03 PM

Ohio Gov. John Kasich speaks at Forum Club of the Palm Beaches in West Palm Beach, Florida on Friday, May 26, 2017. (Allen Eyestone / The Palm Beach Post)

Ohio Gov. John Kasich weighed in on his former Republican presidential nomination rival Donald Trump at a Forum Club of the Palm Beaches lunch on Friday — but he spent more time talking about a pair of encounters he had with former President Richard Nixon.

Kasich spoke to a sellout crowd of about 700 at the Kravis Center to promote his new book Two Paths: America Divided or United. He said America is divided because conservatives and liberals tend to read, watch and listen only to media sources that confirm their points of view.

» John Kasich: ‘I have no clue what I’m doing in 2020’

“Turn off the cable television and go back to bowling,” advised Kasich, who used to host a show on Fox News Network.

He also said people can “live life bigger than themselves” by reconnecting to their faith.

“The beautiful thing about faith (is)…in the next hour we have a chance to do better. And I think we need to come together as a nation again and love our neighbor and spend 10 minutes out of every day reading something that we don’t agree with. It begins to open our minds to other people.”

Kasich told the story, included in his book, of how his persistence as an Ohio State University freshman in 1970 led to him getting a meeting with Nixon in the Oval Office.

Promised five minutes with the president, Kasich said the meeting ended up lasting longer.

» FLASHBACK: After Paris attacks, John Kasich hits U.S. ‘unwillingness to lead’

“The good news is as an 18-year-old I spent 20 minutes in the Oval Office with the president of the United States,” Kasich said. “The bad news is I spent 18 years in Congress and if you add up all the time I spent in the Oval Office, I peaked out at 18.”

Kasich called the Nixon anecdote “a good story for young people because it means dream big. For all of us, dream big, keep asking, just keep doing what you want to do until somebody tells you it’s impossible and then don’t believe that.”

Kasich was asked about Trump during a question-and-answer session. He noted that he didn’t endorse Trump in 2016 or attend the Republican National Convention, even though it was in Kasich’s home state.

“I didn’t do that because I was mad about something,” Kasich said of his refusal to back his party’s nominee.

“It’s just that I’m not going to support people who are putting people down or being negative or not bringing us together. Now that he’s president, of course I root for him as much as I can, just like I rooted for the pilot on the airplane that brought me to Florida. I want them to be successful.”

» RELATED: Kasich gives Trump an ‘incomplete’ grade

As the question segment was winding down, Forum Club President Michelle McGovern told Kasich, “We have at least five people who want to know about your conversation with Nixon.”

So Kasich told the audience about a second conversation he had with Nixon in 1987. Kasich was a House member then and both his parents had just been killed by a drunk driver.

When he told Nixon about losing his parents, Kasich said, “His reaction was amazing. It was like he had been shot. It hit him like a ton of bricks.

“I said, ‘My sister is really struggling. Could you send her a note?’ And he wrote her a handwritten two-page letter that will be put in the Nixon Library at some point. It was just so amazing. And that’s a side of him that we don’t hear about.”

Kasich wasn’t asked about whether he’ll run for president again in 2020 — a possibility he hasn’t definitively ruled out. He said he’s relieved sometimes that he didn’t win in 2016.

“I’m a happy guy,” Kasich said. “I wake up in the mornings sometimes and say ‘Lord, thank you for never letting me have that job.’”

Ohio congressman leading effort to keep Republicans in power in House

Published: Sunday, May 28, 2017 @ 8:00 AM
Updated: Friday, May 26, 2017 @ 1:35 PM


            US Capitol

On Wednesday afternoon, Columbus-area Rep. Steve Stivers, the head of the National Republican Congressional Committee, predicted the GOP candidate in an unexpectedly tight special election in Montana would eke out a win.

A few hours later, that GOP candidate, Greg Gianforte, reportedly body–slammed a reporter minutes before what was to be the last campaign rally before Election Day. Gianforte was charged with misdemeanor assault.

RELATED: Greg Gianforte wins special election in Montana

Stivers, who didn’t hear about the incident until 8 p.m. that night, sent out a statement the next day saying that Gianforte’s behavior “was totally out of character, but we all make mistakes. I believe he should apologize to the reporter.”

Late Thursday, he called, saying he didn’t want his statement to seem as if he was “making light” or “minimizing” Gianforte’s behavior in any way. “It was a mistake in judgment,” he said of Gianforte.

The two hadn’t spoken as of early Thursday night. “He needs to do the right thing,” Stivers said of Gianforte, who apologized as part of his victory speech later that night.

Stivers, an Upper Arlington Republican, knew that his job protecting the GOP majority would be tough. But there’s no way he could’ve known he was signing up for this.

RELATED: Health care bill remains linchpin for Trump agenda in Congress

Stivers faces the perils of history:

* Midterm elections during a president’s first term have historically been lousy for the House majority party.

* The party has struggled to unite on issues such as health care.

* And Democrats, galvanized by President Donald Trump, have shown up to protest at town hall meetings of congressmen, often boisterously.

Still, insists Stivers, 52: “I knew what I signed up for.”

Perpetually upbeat and quick with a joke, Stivers insists that despite the circumstances, “I believe in our members. I believe in what we’re doing. I think they have America’s best interests at heart and I think they’re trying to do the right things.”

Start with the history: the president’s party has lost seats in the House in 18 out of 21 midterms since the Franklin D. Roosevelt administration. In 2018, Democrats will need to net 24 seats in order to win the House majority.

Kyle Kondik of the University of Virginia Center for Politics said in this environment, limiting Democratic gains could be a win, he said.

“I’d say holding the Democrats to a single–digit gain of seats would be a very successful midterm for Stivers and the NRCC given historical trends, Trump’s rocky start, and early indications of significant Democratic enthusiasm,” he said.

Working for the team

Stivers said most of the work his new role presents is work he does when he’s already in D.C. for legislative business. He only campaigned for a House candidate once since assuming his role – and that was when he went to Georgia for one day. He said he’s also had nine telephone town halls this year, trying to do them every few weeks. He prefers those to live town halls, in part because they can be done while he’s in D.C., in part because it allows him to reach out to thousands of voters in one call and in part because he is loath to attend an event where he believes some come just raise a ruckus.

“There are some people who want to go to a town hall because they really want have live conversation with me, but there are other people who want to have a live town hall because they want to cause a problem, and those people disrupt the actual process for constituents having a real dialogue,” he said. “I’m not for that.”

He acknowledges Democrats are energized. But the GOP base is too, he says.

“While their base is excited enough to make (the campaigns) close, our base is excited enough to come out and win,” he said.

The first bellwethers are the special elections: Trump tapped several House Republicans to fill cabinet positions, and Stivers has worked to recruit good candidates to fill those open seats. Special elections are also set in Georgia and South Carolina.

Any loss, at this point, could be considered foreshadowing of what might happen next year.

But Stivers insists special elections are special for more than just the timing. They’re often unpredictable and the results are often an anomaly more than a trend.

“I think people read too much into special elections,” he said, Wednesday, before the scuffle in Montana. “That said, I plan on winning them all.”

Even if Stivers has a poor cycle, it may not mark the end for the four–term Republican, said Kondik, who noted that former Rep. Chris Van Hollen oversaw the DCCC when it got routed in 2010, but he bounced back to win a Senate race in 2016 and is chairing the DSCC this cycle.

But Stivers’ intentions are clear.

“I want to hold the majority,” Stivers insists. “I don’t play to lose and I want to hold the majority… if we can deliver on the promises we have made I believe we can pick up seats.”

PARTY IN POWER

The party in power lost seats in 18 of the last 21 midterm elections stretching back to Franklin Roosevelt.

2010: Barack Obama’s first midterm: Democrats lost 63 seats

1994: Bill Clinton’s first midterm: Democrats lost 52 seats.

2002: George W. Bush’s first midterm: Republicans gained eight seats.

1990: George H.W. Bush’s midterm: Republicans lost eight seats.

1982: Ronald Reagan’s first midterm: Republicans lost 26 seats.

Source: The American Presidency Project, University of California at Santa Barbara

Senate Republicans head home still searching for health care deal

Published: Friday, May 26, 2017 @ 12:29 AM
Updated: Friday, May 26, 2017 @ 12:30 AM

As lawmakers trooped out of the U.S. Capitol on Thursday and headed home until early June, Senate Republicans told reporters they were making progress, but were still nowhere near finalizing a deal on a major overhaul of the Obama health law.

“Doing nothing is not an option,” said Sen. John Cornyn (R-TX), as top Republicans tried to project a feeling that the GOP is making some headway in making changes to a bill approved in the House earlier this month.

“I believe Senators across the ideological spectrum are proceeding in good faith,” said Sen. Ted Cruz (R-TX).

“Leader McConnell is doing a great job right now, focusing on the priorities that we’ve all agreed to, that are broken under Obamacare,” said Sen. David Perdue (R-GA), who said he thought there would be legislative language put together in the near future by GOP Senators.

But one thing no one was talking about on the GOP side, was when a health care bill might get to the Senate floor for an actual debate, and vote.

“We’re a long ways from that,” said Sen. Mike Rounds (R-ND), “but you’ve got to start with something to begin with. And that’s what this is all about.”

But the schedule is already squeezing Republicans, as there are four work weeks in June, plus three in July – then Congress is scheduled to leave for a five week summer break that lasts until Labor Day.

Not only are there few work days, but Republicans still have to get the House bill past the scrutiny of the Senate Parliamentarian, and then make sure any changes also pass muster with strict Senate rules governing budget reconciliation, which prevents a bill from being subject to a 60 vote filibuster.

One item from the House bill that could be in trouble in the Senate, is the idea of allowing states to opt out of certain requirements from the Obama health law, like the list of “Essential Health Benefits” that must be covered by insurance.

How Republicans might broker some of the differences wasn’t clear as members headed for the airport, though individual Senators are clearly looking for a breakthrough.

“Can you talk to me in two weeks? We’re working on something,” Sen. Bill Cassidy (R-LA) told reporters, refusing to give any hints of what he is trying to cobble together on coverage.

“No, cause I don’t know if it works. I’m running it by actuaries, I’m running it by people who really know their stuff,” Cassidy added.

And that’s where Republicans are right now – still searching for a deal, while the clock keeps ticking.