Home
/
RELIGION & LIBERTY ONLINE
/
The FAQs: The Fiscal Cliff Proposals
The FAQs: The Fiscal Cliff Proposals
May 15, 2026 5:12 AM

Now that we know what the fiscal cliff is all about, what are the plans for dealing with it? Below are the four approaches that have been proposed:

The Democrats’ Plan

Treasury Secretary Timothy Geithner offered the White House’s fiscal cliff proposal to Republicans in the last week of November. Although the proposal wasn’t released to the public, news reports say it was basically a reprise of Obama’s most recent budget request and contained the following items:

• End the Bush tax cuts for those making more than $250,000. The result would be $1.6 trillion in new taxes over 10 years, $160 billion a year.

• Cuts to Medicare and other entitlements over 10 years equal to $400 million, or $40 million a year.

• Additional stimulus spending of $50 billion.

• Authority to allow President Obama to to raise the debt limit without asking Congress in order to prevent “fiscal cliff”-style triggers from being put in place in the future.

• The White House also counts “savings from ending the wars in Iraq and Afghanistan” in their savings tally, even though no one has proposed maintaining war spending over the next decade at the current rate.

Reception: The Republicans rejected Obama’s plan but offered to let it be voted on in the Senate. However, yesterday Senate Majority Leader Harry Reid (D-Nev.) blocked a vote on the president’s proposal.

TheRepublicans’ Plan

Earlier this week,House Speaker John A. Boehner (R-Ohio) and other senior Republicans suggested that a framework laid out by Democrat Erskine Bowles be used as the basis of a plan:

•Raise $800 billion ($80 billion a year) in tax revenue by removing specific existing deductions from the tax code.

•Cutting $600billion ($60 billion a year) from federal health programs, in part by increasing the Medicare eligibility age from 65 to 67.

•Cutting federal agency budgets by $300 billion over ten years ($30 billion a year).

•Saving $200billion ($20 billion a year) by applying a less generous measure of inflation to all federal programs, including Social Security benefits, which would slow the growth of those programs.

Reception: Obama refuses to negotiate on this plan unless Republicans agree to accept e tax hikes on those making $250,000 or more a year.

The Republican Doomsday Plan

Recognizing that they are unable e to an agreement with the president, some House Republicans are considering a Doomsday Plan:

•Allow a vote on extending the Bush middle class tax cuts (the bill passed in August by the Senate).

•To express disapproval at the failure to extend all tax cuts, Republicans would vote “present” on the bill, allowing it to pass entirely on Democratic votes.

Reception: President Obama has said he will reject this option too, implying that he would veto such legislation.

The ‘Let’s Go Off the Cliff’ Plan

The simplest—and increasingly most likely—option would be for Congress and the White House to take no legislative action before January. Taxes would go up and spending would be cut and then . . .

Reception: We may soon find out.

Comments
Welcome to mreligion comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
RELIGION & LIBERTY ONLINE
Obamacare vs the Catholic Bishops
I pleted a very short interview on Vatican Radio to discuss the current battle between the Obama administration and the United States Conference of Catholic Bishops. It didn’t permit me to say more than that the Obama administration is making a political mistake, so I’d like to say a bit more about the serious consequences that will likely result and how we ended up with this Church-State conundrum in the first place. As Dr. Donald Condit has already explained, the...
Playing Politics with Unemployed Veterans
In mentary this week, I reflect on the unemployment rate of many newly separated military veterans of our Armed Forces. The grim jobs outlook affects our reservists and National Guard forces too. As You Were, a book I reviewed on the PowerBlog in late 2009, touched on this topic quite a bit. My first job out of college was working on veterans issues for former Congressman Gene Taylor (D-Miss.) I was able to meet and get to bat veterans from...
Next Steps Conference – Business As Mission
I am attending the Next Steps conference hosted by Indiana Wesleyan University and organized by IWU Students for BAM. This is their first annual conference. Acton Institute is sponsoring this conference as a part of our evangelical network building work. As I have opportunity, I will post blogs including highlights of the plenary and workshop sessions. Last night, Bill Moore, owner and CEO of PacMoore Products spoke on principles of integrating business as mission in pany. Bill started his lecture...
Samuel Gregg: The Vatican’s Calls for Global Financial Reform
In the journal Foreign Affairs, Acton Research Director Samuel Gregg offers an analysis of the Vatican’s recent pronouncements on economic policy, most notably the document issued in October titled “Towards Reforming the International Financial and Monetary Systems in the Context of Global Public Authority” (also called “The Note”). The Church, Gregg said, “wanted to attract the attention of world leaders as they assembled to discuss ongoing turmoil in financial markets at the G-20 Summit in Cannes and to add its...
Orthodox Bishops Assembly Silent on Moral Issues
Update, Feb. 2: the Assembly of Bishops issued a press release to “adamantly protest” the HHS mandate. On the Observer blog of the American Orthodox Institute, I look at the non-reaction of the Assembly of Canonical Orthodox Bishops of North and Central America to the recent Obama administration mandate that forces most employers and insurers to provide contraceptives, sterilization, and abortifacient drugs free of charge. More specifics here. The Assembly of Bishops, charged with the mon witness” for Orthodox Christians...
The Dutch Resistance: Diet Eman at Aquinas College
At last summer’s Acton University conference, one of the evening key note lectures included Diet Eman, a Grand Rapids resident and one of the leaders of the World War II Dutch resistance. As a 20-year-old bank teller in the Netherlands in 1940, Diet dove into underground activities, doing anything she could to protect Jews from the deadly Nazi advance.She, along with a small minority of ordinary Dutch citizens, bravely put their lives on the line to preserve human life and...
Madison the Politician
James Madison has rightfully been forever identified as father of the U.S. Constitution, author of the Bill of Rights and coauthor of the Federalist Papers. In his new biography of America’s fourth president, Richard Brookhiser introduces us to Madison the politician. In many ways, Madison is the father of modern American politics, with all its partisanship, wheeling and dealing, vote getting, partisan media, and popular opinion polling. Brookhiser helps us to see the early framers as they were, brilliant men,...
Video: Renewing the Call: Why Pastors and Business Leaders Need Each Other
At this past year’s Evangelical Theological Societymeeting, the Oikonomia Network convened a luncheon entitledRenewing the Call: Why Pastors and BusinessLeaders Need Each Other. Dr. Amy Sherman, senior fellow at the Sagamore Institute and author of recently publishedKingdom Calling: Vocational Stewardship For the Common Goodpresented along with Dr. Scott Rae, professor at Talbot School of Theology and co-author of Business For the Common Good: A Christian Vision For the Marketplace. Click the video image below to watch the luncheon presentation. ...
The Perils of Presidential Prooftexting
Much has been made already about President ments yesterday at the National Prayer Breakfast concerning the Christian faith’s teachings about social responsibility. During his time at the breakfast, the president opined that getting rid of tax breaks for wealthy Americans amounted to a Christian obligation: In a time when many folks are struggling and at a time when we have enormous deficits, it’s hard for me to ask seniors on a fixed e or young people with student loans or...
Video: Sirico on Presidential Prooftexting
Jordan Ballor has already mented on President Obama’s ments on taxation and Christian social responsibility. Acton President Rev. Robert A. Sirico now joins the fray, having been called upon by Fox News Channel to add his insight to the discussion. In case you missed yesterday’s appearance on “Your World with Neil Cavuto,” we’ve got it for you. ...
Related Classification
Copyright 2023-2026 - www.mreligion.com All Rights Reserved