Democrats threaten to push America over ‘fiscal cliff' in absence of tax increases

ByRachel Rose Hartman
July 16, 2012, 3:44 PM

— -- Sen. Patty Murray (D-Wash.) on Monday announced that Democrats are willing to allow a slew of tax cuts and spending provisions to expire if Republicans refuse to raise taxes on the wealthy, potentially inching the country off a "fiscal cliff."

"If we can't get a good deal, a balanced deal, that calls on the wealthy to pay their fair share, then I will absolutely continue this debate into 2013, rather than lock in a long-term deal this year that throws middle class families under the bus," Murray, a Budget committee member and former co-chair of the debt supercommittee, said at a Brookings Institution discussion of the "fiscal cliff."

"Fiscal cliff" is a reference to the potential crisis faced by the government at the end of this year when the Bush tax cuts and other tax and spending provisions amounting to an estimated $600 billion are set to expire.

Murray added she hopes "it doesn't come to that" and said there are reasons to believe a deal between Democrats and Republicans can be reached before the end of the year. But Murray's threat was clear and she placed the onus squarely on Republicans to make an agreement a reality.

"If Republicans won't work with us on a balanced approach, we are not going to get a deal," Murray said. Murray suggested "responsible Republicans" must take the lead in pushing for revenue and raising taxes, adding that if no deal is reached by Jan. 1, 2013 and the cuts expire, Americans for Tax Reform president Grover Norquist's "no tax" pledge "is no longer relevant to this conversation" and "responsible Republicans" will be free to make decisions outside of Norquist's rigid pledge.

Murray's threat, first  reported Sunday by the Washington Post, has drawn fierce blowback from Republican leaders who argue--with the backing of economists-- that Democrats appear willing to risk a recession to win a battle over taxes for the wealthy.

"In their near-fanatical crusade to inflict even more pain on American businesses, Democrats are now openly admitting that they plan to wait until this debate reaches full throttle and Americans are panicked about the outcome to do anything, because they think it will make it likelier they'll get their way," Senate Minority Leader Mitch McConnell (R-Ky.) said on the Senate floor Monday, adding that the current fight amounts to a political ploy.

"And if they don't, then so be it. They're ready to accept the economic and fiscal consequences. They see a crisis coming, and they don't want to waste it." McConnell said Democrats have ignored Republican proposals to prevent tax increases.

House Speaker John Boehner (R-Ohio) expressed similar criticism, asking in a statement Monday: "Has it come to this, that Democrats are willing to hurt jobs and tank our economy for the sake of a small business tax hike that would also have disastrous consequences?"

"Are Dems Open To Another Recession?" the Senate Republican Communications Center posed in a press release.

Inaction means expiration of the current provisions and uncertainty as to how or when new initiatives will be agreed upon.

Republicans note that economists say uncertainty surrounding the fiscal cliff is already prompting hiring freezes in the public and private sectors and negatively affecting the economy.

Murray's threat follows an edict issued by President Barack Obama this month to  allow Bush tax cuts to expire for Americans who make more than $250,000 while extending cuts for those making under $250,000.

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