Senate passes bill to avoid fiscal cliff
The Senate has passed legislation to block the impact of across-the-board tax increases and spending cuts that make up the fiscal cliff. The vote was an overwhelming 89-8 and came well after midnight on New Year's Day.
A House vote is expected before Wednesday.
The White House-backed legislation would prevent middle-class taxes from rising, and raise rates on incomes over $400,000 for individuals and $450,000 for couples. It also blocks spending cuts for two months, extends unemployment benefits for the long-term jobless, prevents a 27 percent cut in fees for doctors who treat Medicare patients and prevents a spike in milk prices.
A last-minute addition would also prevent a $900 pay raise for members of Congress from taking effect in March.
The White House and congressional leaders hope to send legislation to President Obama within a day or two, meaning consumers shouldn't notice any impact. The goal of the legislation is not only to protect consumers' pocketbooks, but also to prevent the economy from the risk of another recession.
House Republicans won't vote Monday
The House will miss the midnight Monday deadline lawmakers set for voting to avoid the "fiscal cliff."
House Republicans notified lawmakers that the chamber will vote Monday evening on other bills. They say that will be their only votes of the day.
President Barack Obama and Senate Republican leader Mitch McConnell said Monday they are near a deal to avoid wide-ranging tax increases and spending cuts - the fiscal cliff - that take effect with the new year.
Both men said they were still bargaining over whether - and how - to avoid $109 billion in cuts to defense and domestic programs that take effect on Wednesday.
Congress could pass later legislation retroactively blocking the tax hikes and spending cuts.
Earlier Monday, President Obama said it appeared that an agreement was "in sight," but said it's not yet complete and work continues.
Obama said this has been a "pressing issue on people's minds," and told an audience of middle-class taxpayers the deal would, among other things, extend unemployment benefits for Americans "who are still out there looking for a job."
He voiced regret that the work of the administration and lawmakers on Capitol Hill won't produce a "grand bargain" on tax-and-spend issues, but said that "with this Congress, it couldn't happen at that time."
Senate Minority Leader Mitch McConnell says he and the White House have agreed on preventing tax hikes that the "fiscal cliff" will trigger after midnight. And he says they are very close to an overall deal that would also prevent budget-wide spending cuts.
The Kentucky Republican did not provide any details. But he said on the Senate floor that lawmakers should pass legislation averting tax increases that would otherwise take effect at the start of New Year's Day.
McConnell spoke after President Barack Obama said in televised remarks from the White House that a deal was in sight.
At the stroke of midnight, automatic tax hikes and deep spending cuts will take effect if lawmakers can't broker a deal.
President Obama appeared on Meet the Press Sunday morning. He said the sticking point for Republicans was a tax increase on the wealthy.
"I think it's been very hard for Speaker Boehner and Republican Leader McConnell to accept the fact that taxes on the wealthiest Americans should go up a little bit-- as part of an overall deficit reduction package," said the president.