Reuters - California Governor Jerry Brown and Democratic legislative leaders have reached a deal that bypasses Republicans and relies on higher tax revenue forecasts and some spending cuts to close a $10 billion gap.
In a long-overdue moment, governor Jerry Brown has finally admitted the obvious, the state's pension system is broke and California Has "Lived Beyond Our Means". Unions of course are howling at that obvious admission.
California, like Greece is perpetually in fiscal trouble. Overoptimistic revenue forecasts coupled with spending $2 billion more than expected has California in a deep hole. Governor Jerry Brown has the same non-solution as ever, hike taxes.
Brown wants a "temporary" (as in seven years) tax hike. Given we all know there are no such things as temporary tax hikes in California (seven years is permanent enough in the first place), and also given the California school budget needs an axe, the I say let him.
The Democrats made several key concessions yesterday in the Fiscal Cliff negotiations. As a result, the two sides are absurdly close together. If we don't get a deal at this point, the entire country will be justified in being outraged.
WASHINGTON — The U.S. Congress comes back on Monday without a deal to avert the “fiscal cliff” and only a few hours of actual legislative time scheduled in which to act if an agreement materializes.
Negotiations involving Vice President Joe Biden and Senate Republican leader Mitch McConnell appeared to offer the last hope for avoiding the across-the-board tax increases and draconian cuts in the federal budget that will be triggered at the start of the New Year because of a deficit-reduction law enacted in August, 2011.
House Republicans plan to vote next week on a three-month extension of U.S. borrowing authority in an effort to force the Democratic-led Senate to adopt a budget plan.
“We are going to pursue strategies that will obligate the Senate to finally join the House in confronting the government’s spending problem,” Speaker John Boehner of Ohio said in a statement Friday at the end of the party’s private policy retreat at a resort near Williamsburg, Virginia. “The principle is simple: no budget, no pay.”
S&P 500 futures are up 24 points (1.7%) and gold is up $22 (1.3%) on news McConnell-Biden Said Close to Deal Except for Sequester
The White House and congressional negotiators have agreed to contours of a deal to avert the fiscal cliff including tax cut extensions, with the remaining sticking point being how to handle automatic military and domestic cuts, according to an official familiar with the talks.
Mitch McConnell, the Senate minority leader who has stayed largely outside the U.S. budget fight this year, will be thrust into prominence just five days before the deadline for tax increases and spending cuts.