Issue link: https://www.epageflip.net/i/101542
8A Daily News ��� Thursday, January 3, 2013 Cliff averted, it���s on to the next fiscal crisis WASHINGTON (AP) ��� Onward to the next fiscal crisis. Actually, several of them, potentially. The New Year���s Day deal averting the ������fiscal cliff������ lays the groundwork for more combustible struggles in Washington over taxes, spending and debt in the next few months. President Barack Obama���s victory on taxes this week was the second, grudging round of piecemeal successes in as many years in chipping away at the nation���s mountainous deficits. Despite the length and intensity of the debate, the deal to raise the top income tax rate on families earning over $450,000 a year ��� about 1 percent of households ��� and including only $12 billion in spending cuts turned out to be a relatively easy vote for many. This was particularly so because the alternative was to raise taxes on everyone. But in banking $620 billion in higher taxes over the coming decade from wealthier earners, Obama and his Republican rivals have barely touched deficits still expected to be in the $650 billion range by the end of his second term. And those back-of-the-envelope calculations assume policymakers can find more than $1 trillion over 10 years to replace automatic across-the-board spending cuts known as a sequester. ������They didn���t do any of the tough stuff,������ said Erskine Bowles, chairman of Obama���s 2010 deficit commission. ������We���ve taken two steps now, but those two steps combined aren���t enough to put our fiscal house in order.������ In 2011, the government adopted tighter caps on day-to-day operating budgets of the Pentagon and other cabinet agencies to save $1.1 trillion over 10 years. The measure passed Tuesday prevents middleclass taxes from going up while raising rates on higher incomes. It also blocks severe across-theboard spending cuts for two months, extends unemployment benefits for the long-term jobless for a year, stops a 27 percent cut in Medicare fees paid to doctors and prevents a possible doubling of milk prices. The alternative was going over the cliff, an economy-punching halftrillion-dollar combination of sweeping tax increases and spending cuts. Despite the deal, the government partially went over the brink anyway with the expiration of a two-year cut in Social Security payroll taxes of two percentage points. Action inside a dysfunctional Washington now only comes with binding deadlines. So, naturally, this week���s hard-fought bargain sets up another crisis in two months, when painful across-the-board spending cuts to the Pentagon and domestic programs are set to kick in and the government runs out of the ability to juggle its $16.4 trillion debt without having to borrow more money. Unless Congress increases or allows Obama to increase that borrowing cap, the government risks a first-ever default on U.S. obligations. Republicans will use this as an opportunity to leverage more spending cuts from Obama, just like they did in the summer of 2011. House Speaker John Boehner, R-Ohio, vows that any increase in the debt limit ��� which needs to be enacted by Congress by the end of February or sometime in March ��� must be accompanied by an equal amount in cuts to federal spending. That puts him on yet another collision course with Obama, who has vowed anew that he won���t let haggling over spending cuts complicate the debate over the debt limit. The cliff compromise represented the first time since 1990 that Republicans condoned a tax increase. That has whipped up a fury among tea party conservatives and increased the pressure on Boehner to adopt a hard line in coming confrontations over the borrowing cap and the spending cuts that won only a two-month reprieve in this weeks��� deal. Put simply, House Republicans are demanding new spending cuts ��� possibly through changes in Social Security and Medicare benefit formulas ��� as a scalp, and they���re dead set against raising more revenues through anything less than an overhaul of the tax code now that Obama has won higher taxes on the wealthy. ������Now the focus turns to spending,������ Boehner said after Tuesday���s vote, promising that future budget battles will center on ������significant spending cuts and reforms to the entitlement programs that are driving our country deeper and deeper into debt.������ Obama is just as adamant on the other side, saying higher revenues have to be part of any formula for further diverting the automatic spending cuts. While conservative activist Grover Norquist gave Republicans a pass on violating his anti-tax pledge with this week���s vote, he and other forces on the right won���t be so forgiving on any future effort to increase revenues. The refusal of Republicans to consider additional new taxes is sure to stir up resistance among Democrats when they���re asked to consider politically painful cuts to socalled entitlement programs like Medicare. Democratic protests led Obama and Boehner to take a proposal to increase the Medicare eligibility age off the table in the recent round of talks. The upshot? More scorched-earth politics on the budget will probably dominate the initial few months of Obama���s second term, when the president would prefer to focus on legacy accomplishments like fixing the immigration problem and implementing his overhaul of health care. The relationship between Boehner and Obama has never been especially close and seemed to have suffered a setback last month after the speaker withdrew from negotiations on a broader deficit deal. The two get along personally, but politically, a series of collapsed negotiations has bred mistrust. The White House has the view that Boehner cannot deliver while the speaker is frustrated that matters brought up in his talks with the president are not followed through by White House staff. And on the debt limit, Boehner and Obama at this point are simply talking past each other. ������While I will negotiate over many things, I will not have another debate with this Congress over whether or not they should pay the bills that they���ve already racked up through the laws that they passed,������ Obama said after the deal was approved. Said Boehner spokesman Michael Steel: ������The speaker���s position is clear. Any increase in the debt limit must be matched by spending cuts or reforms that exceed the increase.������ Deal will prevent spike in milk prices WASHINGTON (AP) ��� A potential doubling of milk prices will be averted as part of the compromise that White House and congressional bargainers reached on wide-ranging legislation to avert the ������fiscal cliff,������ a leading senator said late Monday. Senate Agriculture Committee Chairwoman Debbie Stabenow, DMich., told reporters that negotiators had agreed to extend portions of the expired 2008 farm bill through September. She said that includes language keeping milk prices from rising, but excludes other provisions like energy and disaster aid for farmers. Stabenow said she considers the slimmed-down extension to be ������Mitch McConnell���s version of a farm bill.������ She was referring to the Senate Republican leader from Kentucky, who she said forced bargainers to accept the version of the farm bill that appeared in the deal. McConnell spokesman Michael Brumas responded: ������Sen. McConnell put forward a bipartisan, responsible solution that averted the dairy cliff and provided certainty to farmers for the next year without costing taxpayers a dime.������ Just a day earlier, Stabenow said leaders from both parties on the House and Senate agriculture committees had agreed to extend the entire farm bill. Stabenow and House Agriculture Chairman Frank Lucas, R-Okla., announced Sunday that they had agreed on a lastminute move that would extend the entire farm bill and replace dairy programs that expire at midnight Tuesday. Expiration of those dairy programs could mean higher milk prices at the grocery store within just a few weeks. But the House GOP had not endorsed the committees��� extension agreement. The nonpartisan Congressional Budget Office estimated Sunday that extending the entire bill BULL & GELDING SALE ~ Special Editions ~ Tuesday, January 22 ��� Saturday, January 26, 2013 As we do for the Red Bluff Round-Up and Tehama District Fair, the Daily News will customize its daily editions during the Bull & Gelding Sale with news and photos from the event; what���s coming up that day, what happened yesterday, and so on. Red Bluff will have lots of out-of-town visitors that week ��� we���ll promote readership of our special daily editions to these visitors with custom rack cards, and distribution of extra copies at the Fairgrounds. The Bull and Gelding Sale is a world-famous event and a local tradition! Make sure to ���brand��� your business as supportive of the event and welcoming to the visitors the event draws, with a 5x Flight of ads in these special editions. Run your ad TUES-FRI & get Saturday FREE! 6 column inch minimum: 5-day ���Flight��� packages starting at GET SATURDAY FREE! 19640 $ Includes: ��� Five 2 col x 3��� ads ��� Full color ��� Internet ��� Find-N-Save online ads directory For other than 5x Flight advertising: Regular display rates apply Deadline for 5x Flights: Friday, January 18 at Noon Don���t be left out! Contact your Advertising Representative today DAILY NEWS RED BLUFF TEHAMA COUNTY (530) 527-2151 Email: advertise@redbluffdailynews.com through September, including disaster assistance for farmers affected by drought, could cost more than $1 billion this budget year. House Speaker John Boehner, R-Ohio, has pushed back on passage of a new five-year farm bill for months, saying there were not enough votes to bring it to the House floor after the House Agriculture Committee approved it in July. The Senate passed its version of a farm bill in June. The bill, generally passed every five years, includes food stamps, farm subsidies and other help for rural areas. But the prospect of higher milk prices prompted some action. Agriculture Secretary Tom Vilsack has said Americans face the prospect of paying $7 for a gallon of milk if the current dairy program lapsed and the government returned to a 1948 formula for calculating milk price supports. Extending the entire agriculture bill would have included an overhaul of dairy programs that was included in both the Senate and House com- mittee bills. The new dairy programs include a voluntary insurance program for dairy producers, and those who choose that new program also would have to participate in a market stabilization program that could dictate production cuts when oversupply drives down prices ��� an idea that hasn���t gone over well with Boehner. In July, he called the current dairy program ������Soviet-style������ and said the new program would make it even worse. Large food companies that process and use dairy products have backed Boehner, saying the program could limit milk supplies and increase their costs. One of the reasons Boehner has balked at bringing up a farm bill is disagreement among House Republicans over how much money should be cut from food stamps, which make up roughly 80 percent of the half-trillion-dollar bill���s cost over five years. Lucas has unsuccessfully pushed his leadership for months to move on the legislation despite the disagreement over food aid. 741 Main Street, Suite #2 Red Bluff, CA 96080 1-800-287-2187 (530) 527-2187 C & C PROPERTIES An Independently owned and operated Member of Coldwell Banker Residential Affiliates. 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