At least, they had better be here. The December 31 deadline leaves just over four weeks for policymakers to reach an agreement. If not, it is well known that over $600 billion in spending cuts and tax increases will trigger as America trips over the fiscal cliff, presumably breaks her hip, and enters what many speculate will be another recession.
Republican Speaker of the House John Boehner and President Barack Obama are the chief negotiators in the discussions. Their positions are well established and the points of contention between the two camps have been repeatedly highlighted: Democrats want revenue hikes, some $1.6 trillion in the most recent proposal, and Republicans want spending cuts that are at least in line with revenue hikes.
Catalysts are critical to discovering winning stocks. Check out our newest CHEAT SHEET stock picks now.
The mood surrounding the talks has danced back and forth between positive and negative, and on Friday the mood is negative. Obama is leaving Washington to travel to Hatfield, Pennsylvania, where he will speak at a toy manufacturing facility and try to rouse public support for his proposal — a proposal that was rejected on Thursday by disappointed Republicans….
“No substantive progress have been made in the talks between the White House and the House over the last two weeks,” Boehner told reporters. “There’s been no serious discussion of spending cuts so far, and unless there is, there’s a real danger of going off the fiscal cliff.”
Democrats counter that they have already proposed legislation consisting of $1 trillion in spending cuts and that they are waiting to see a clear proposal from Republicans on what they want cut. Republicans, as Boehner notes, view the current Democratic offer as a joke highlighted by the massive $1.6 trillion revenue figure in the recent proposal. It’s a far cry from the $800 billion or so that was being tossed around before the election. Republicans are likely looking to settle for a figure closer to $1 trillion.
“I’m disappointed in where we are and disappointed in what’s happened over the last couple of weeks,” Boehner said after meeting with Treasury Secretary Timothy Geithner on Thursday. If the cliff does trigger, the past few weeks will indeed be tremendously disappointing as the reason why America slammed the brakes on its own economy.
In Boehner’s weekly press conference, Boehner said that “the President has warned us about the dangers of going over the fiscal cliff, but his actions have not matched his public statements.” Boehner criticized the President’s decision to go on a road trip and try to rally the public instead of remaining in Washington to continue discussions.
Don’t Miss: Is Bernanke Right About the Fiscal Cliff?