Minn. lawmakers split over budget solutionsWASHINGTON — Negotiations continue to move slowly between the Obama administration and Congressional Republicans as they try to avert a series of automatic tax increases and budget cuts that take place at the beginning of next year.
By: Brett Neely, Minnesota Public Radio News
WASHINGTON — Negotiations continue to move slowly between the Obama administration and Congressional Republicans as they try to avert a series of automatic tax increases and budget cuts that take place at the beginning of next year.
None of Minnesota’s 10-member delegation sits at the negotiating table over the “fiscal cliff.” But they will have to vote on whatever agreement is made, if a deal happens, and numerous issues unite and divide them.
When it comes to the big issues, such as whether middle-class taxes should go up or whether $109 billion worth of budget cuts should kick in next year, both parties agree neither should happen. But U.S. Rep. Keith Ellison, a Democrat who represents Minneapolis, is particularly worried about the effect of spending cuts on jobs.
“I want to make sure that we do not inflict austerity on this economy because I think that will lead to layoffs. I think that will worsen the economy,” Ellison said.
Members of both parties agree that tax rates should stay where they are for those making less than $250,000 a year. But they are divided on what should happen to those making more.
President Obama and most Democrats want to raise taxes on the wealthiest taxpayers back to the rates that existed during the presidency of Bill Clinton in the 1990s.
But raising those top tax brackets could lead to a financial calamity, warns Republican U.S. Rep. John Kline, who represents the southern Twin Cities suburbs.
“It does make a difference because there’s a lot of empirical evidence that raising rates will have an immediate impact on the growth of the economy,” Kline said. Many economists, however, do not agree with that conclusion.
U.S. Rep. Tim Walz, a Democrat who represents Minnesota’s 1st District, said the rates have been low since Republicans cut them under President George W. Bush in the early 2000s and there is little to suggest that tax rates have such a direct impact on the economy.
“If lowering those tax rates on the top 2 percent had created a boom in economic and job growth, then we would be supportive of it, but there’s absolutely no evidence that that happened,” Walz said.
While many Republicans now say they would consider raising tax revenues — but not rates — U.S. Rep. Chip Cravaack is not among them. Although he lost his bid for re-election to Democrat Rick Nolan, Cravaack said that does not mean he is backing down on his small government principles before his term ends on Jan. 3.
“The president keeps on pushing us to revenues,” Cravaack said. “Where are the spending cuts? And until we have any spending cuts, I’m not willing to talk about revenue.”
To obtain the support of most of the 240 Republicans who serve in the House, any agreement probably will have to cut spending, especially on entitlement programs, including Social Security and Medicare.
Any agreement that touches Social Security or the other entitlements won’t receive the support of liberal Democrats, Ellison said.
Even one of the most fiscally conservative Democrats in the House, U.S. Rep. Collin Peterson of the 7th District, agrees with Ellison that Social Security should be off the negotiating table.
“Social Security is not the problem,” Peterson said. “It’s not causing the deficit.”
Perhaps the biggest optimist in the delegation is U.S. Sen. Amy Klobuchar, a Democrat who won a second term in November. Despite the partisan bickering, she said, there actually is progress.
“There are going to be days where it feels like people are on complete opposite ends,” Klobuchar said. “If you really look at the movement, think about the change from six months ago, no Republicans were talking about revenue then and now they are.”