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The 'fiscal cliff' showdown

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    Both sides dig in as deadline nears

  • Duration 6:27
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I am ready and able and willing and excited.

To go ahead and get this issue resolved.

In a bipartisan fashion.

Says that American families American businesses have some certainly going into next year.

I'm disappointed.

-- where we are and disappointed at what's happened.

Over the last couple weeks.

Public -- over the fiscal cliff is serious business.

And I'm here seriously trying to resolve it and how -- the white house -- terrorism.

Well.

Welcome to The Journal Editorial Report I'm -- if -- -- not exactly -- meeting of the minds this week between President Obama.

And house speaker John Boehner on just where talks to end the fiscal showdown -- the president.

For his part took his case to the public and repeated his call for a tax hike on upper income Americans.

But made little mention of cuts to entitlement spending something the speaker says must be part of any final deal.

Joining the panel this week Wall Street Journal columnist and deputy editor campaigning -- editorial board member.

Mary Anastasia O'Grady and Washington columnist.

Kim Strauss OK Kim so you're stuck in Washington having to talk to all of these sources.

Is the mood is in you've been working on this week -- -- is the mood is sour as it sounds.

It is and by the end of this week and here's why -- so you know the Republicans came out right after the elections said to the president.

You -- revenue here you won't revenue on the wealthy will give it to you let's do this via limiting tax deductions for the wealthy.

The president then of taking that running with it if it's the sealing a deal has been out campaigning for tax hikes and then to cap it off sent Treasury Secretary.

Tim Geithner down to congress this week with this absolutely outrageous proposal it's basically a -- violation of everything the president wanted in his budget it's beyond what he even campaign for.

And as a result I think most Republicans -- wonder just how serious he is about doing this they feel things are going back court.

You know that that's the way it -- to me too I talked to some senior Republicans this week and they're increasingly of the belief.

That may be the president.

Wants to back them into -- corner.

That could push them over the cliff and then be able to blame them if if you have a recession -- for taxes going up on everybody.

Well I don't.

Doubt that please try to it's hard to see where the -- site is for the president if the economy slips and -- recession and -- -- about 2013.

Having no growth.

-- horrible yeah and so it's a little hard to see what the game is I think as Tim was mentioning that the president wants these tax increases.

It seems to me we're gonna go through this sort of scorpion dance here through the rest of the year.

What did the president.

Campaign on what was the one thing I think most people would say that he campaigned -- that was raising tax rates on the wealthiest those two top rates right that's the thing that I think is on the table and the.

Republicans put that I'm the Republicans have put that on the at least through deductions and that's the debate with a -- toward him -- -- But but they're willing to put that on the table the question is what does the president then give Republicans in return if anything.

Well I think that's what the Republican position should be necessary we have committed to what you campaigned on if you're not willing to talk about reducing spending.

Then we're not going to be able to do would deal with -- and I think that puts the political opponents to some extent.

Back on the white.

How's married the that the Republicans have been fighting among themselves over there are no new taxes pledge and Grover Norquist the activists in Washington saying -- -- famously has Republicans on record as saying what I won't vote for a tax increase.

Are they.

Really ending up here negotiating with themselves in a way that hurts their position -- -- the president.

Well certainly they are and I think that the president is.

Energized by the fact that he thinks look I ran a lousy economy for four years I left unemployment high.

I increase the size of the debt and the deficit.

I'm I got everything I want and this -- -- some mass.

I got reelected.

So you know what's so hard about me continuing to do that and blaming it on -- because obviously.

I'm very good -- that and that's basically where he's going -- and the Republicans I think are not very good poker players first of all they signaled.

That there kind of really reluctant to go over the cliff and I think.

If you're in this kind of a showdown -- to say you know bring it.

-- and.

You'll do it -- that they will get blamed for it so if if if that happens is no question the president's already signaling so that would be a pleasant outcome for them we are saying that they should suggest.

To the president that we'd be willing to do that and then maybe he'll give at the end.

I think they have to show that they are it that he -- -- negotiation and that he has to give.

And that they're willing to and then if they just say look were so afraid of getting blamed for that of course is gonna roll right over them.

Kim where do you think the Republicans are where where should they go here -- mean do they have real options any other options other than maybe just giving the president in the end what he want.

You know talking to Republicans there's a very firm feeling out -- strong feeling that John Boehner should be given some more time to negotiate and see what he -- and yet.

Because look there is an honest belief in the Republican Party that there is a big problem here and if there's an opportunity to do something about the real drivers suspending regular.

Entitlements that they ought to take that opportunity.

They do think you see people turning around to the -- might be a plan B.

One thing that came out this week was -- -- suggestion by Tom Cole who's a Republican from Oklahoma.

Saying you know maybe we should just agree to.

These middle class tax extensions and just signed him given to the president that's what he says he wants.

Get that off the plate and then let him take all the political fallout for everything else that he you know comes that it that they economic can't -- operates the sequester and everything now.

So you still end up having to do something -- The yet spending cuts that are coming and on that on the debt limit and very briefly.

Well -- out but I sit and basically we're back where we were in the twenty -- negotiations.

The Republicans committing -- Tax cuts and tax increases and it Democrats promising to do something on spending later -- -- thirteen.

It's very hard to see -- that's gonna get resolved by the end of the year.

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