PROGRESS? – AT 10:40 A.M. ET: There are reports of progress in the "fiscal cliff" negotiations. From The Politico:
Senate Minority Leader Mitch McConnell (R-Ky.) and Vice President Joe Biden engaged in furious overnight negotiations to avert the fiscal cliff and made major progress toward a year-end tax deal, giving sudden hope to high-stakes talks that had been on the brink of collapse, according to sources familiar with the discussion.
McConnell and Biden, who served in the Senate together for 23 years, are closing in on an agreement that would hike tax rates for families who earn more than $450,000, and individuals who make more than $400,000, according to sources familiar with talks. That would mark significant concessions for both men, particularly for McConnell. President Barack Obama campaigned on raising taxes for families who make more than $250,000, but McConnell has long been dead-set against any tax increases, warning they would jeopardize the economy.
However, there has been no agreement over “turning off” the sequester, tens of billions of dollars in spending cuts that will hit the Pentagon and other federal agencies beginning on Jan. 2, the sources said.
COMMENT: That last point is critical. What the Dems dream of is tax hikes without spending cuts for social programs, but huge spending cuts for the Pentagon. Republicans must not cave if a deal is structured that way.
We will follow this hour by hour. As usual, Obama is providing his brilliant leadership.
December 31, 2012