While you were out enjoying your New Year's Eve, members of the Senate and some of our top lawmakers rang in the new year working on, and eventually passing, a deal to avert the fiscal cliff.
The Senate voted 89-8 to pass a small deal to avert the effects of tumbling over the fiscal cliff sometime around 3 a.m. in Washington last night. So, they didn't make the deadline really, but if the bill passes through the House on Tuesday or Wednesday, which it is expected to, than the country will have avoided the nasty effects of the cliff the president warned about. The deal was mostly brokered between dance partners Mitch McConnell and Joe Biden. The President was happy with it.
Here's what you need to know about the deal that got done:
- Taxes are going up for individuals who make more than $400,000 and couples who make more than $450,000. So, taxes are being raised on the top two percent of Americans just as the President promised.
- Taxes for the middle class, or people earning less than $250,000 at least, are largely protected.
- Estate taxes are rising from 35 percent to 40 percent. Democrats were hoping to take it to 45 percent. Another aspect of the deal also maintains that inherited estates of $5 million for individuals and $10 million for couples to go untaxed.
- The spending cuts for the military and domestic programs expected to come with the fiscal cliff have been delayed for two months. So we'll have to take up another battle in March, essentially.
- Federal farm policies are extended until September, averting the so-called "dairy cliff" that was going to trigger a doubling in milk prices. A win for farmers, and cereal enthusiasts, everywhere.
- A planned pay raise for Congress is cancelled.
There are a few other aspects of the deal, which The New York Times handily outlines here, but those are the larger ones that most people care about. If you were hoping for some sort of debt ceiling aversion being included in the deal, you're going to be disappointed. That will have to be raised by the beginning of March still.
There were pizza boxes lining the garbage cans of the Capitol building this morning as evidence of how late these poor people had to stay. (Don't feel bad for the lawmakers who waited until the last minute to get this done, but the aides who work for them deserve some pity. It's not their fault.)
Two people some were surprised to see vote no on the cliff deal: rumored 2016 Republican Presidential hopefuls Marco Rubio and Rand Paul. Rubio was especially unhappy with the deal:
“I just couldn’t vote for it,” Rubio told reporters. “I ran, just two years ago, on the idea that I wanted to be part of solving the long-term problems this country faces. Time and again, we’re given choices here that don’t involve that.”
“The real fiscal cliff is still there,” he said. “We’ll be back here again. In March, we’ll have a showdown like this all over again.”
House Republicans and Democrats are meeting today to discuss the deal. Most are expecting the bill to go to a vote some time tomorrow. Passage through the House isn't guaranteed, but the Washington Post reports senior aides expect it to go through. It's now also being reported the bill might be amended by the House, which would require it go back to the Senate for another vote.
Speaker of the House John Boehner sounded hesitant to guarantee anything in a statement he released with other GOP leaders last night. "Decisions about whether the House will seek to accept or promptly amend the measure will not be made until House members — and the American people — have been able to review the legislation," he said.
If you're wondering who won in the negotiations, there's no way to say it better than Nate Silver did on Twitter:
Hard to evaluate who "won" the fiscal deal because it's not actually all that clear what either side's goals were.— Nate Silver (@fivethirtyeight) January 1, 2013
This article is from the archive of our partner The Wire.