Congress, Spending Cuts | featured news

Amid a global fright over Washington's political brinkmanship, U.S. lawmakers return to the capital on Tuesday with a seven-week deadline to reach agreement on scheduled tax hikes and budget cuts that threaten to trigger another recession.

Flush with re-election vigor, President Barack Obama on Friday will provide his first public comments on the upcoming negotiations with Congress on how to deal with pending tax hikes and spending cuts that create the so-called fiscal cliff facing the economy at the end of the year.

Washington is growing increasingly jittery about the prospect of automatic spending cuts decimating federal agency budgets in January. So when President Obama declared in Monday’s debate that the cuts “will not happen,” people took note. Read full article >>

When lawmakers return to Washington on Monday, they face big issues, including taxes, spending cuts and the prospect of a debilitating "fiscal cliff" in January. Yet Congress is expected to do what it often does best: punt problems to the future....

The emerging legislation stands in sharp contrast to previous occasions when House Republicans used the leverage of a spending deadline to insist on deep spending cuts.

The game of chicken over the nation's impending "fiscal cliff" — the automatic tax increases and spending cuts due if Congress fails to act by year-end — has officially begun. Congressional Democratic leaders made clear Monday that they had no interest in averting the bleak scenario if Republicans continued to refuse to soften their hard-line opposition to higher taxes on wealthier Americans.

President Obama urged Congress to renew aid to states and local governments so that they can avoid layoffs of teachers.

In a sharp turnaround, House Republican leaders Monday dropped a key demand that the cost of extending the payroll tax cut be offset by spending cuts elsewhere in the budget.

It's just about over for a special deficit-reduction supercommittee, which appears set to admit failure today in its quest to sop up at least $1.2 trillion in government red ink over the coming decade. The bipartisan 12-member panel is sputtering to a close after two months of talks in which key members and top congressional leaders never got close to bridging a fundamental divide over how much to raise taxes. The budget deficit forced the government to borrow 36 cents of every dollar it spent last year.

With the clocks ticking down to deadline, it is becoming increasingly apparent on Capitol Hill that the supercommittee will not be able to reach its goal of cutting $1.2 trillion from the national debt.