WBEN Extra: The Fiscal Cliff

Exclusive WBEN Audio Buffalo's Early News In-Depth: Ed Hutton, Director of the Financial Markets Laboratory at Niagara University, with John & Susan breaking down the various issues in the federal debate over the "Fiscal Cliff" .

On What Could Happen If A Deal Fails: Could we go off the cliff, and survive? Advice to Investors: Don't Panic : The Dangers of No Deal

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 Some Republicans Shifting on Taxes

Lobbyists On Duty

Interactive Special: The Timeline & The Issues
 

If we reach the so-called "Fiscal Cliff" without any action being taken, what will the result be? Crisis ( 25% ) Major problems ( 44% ) Minor problems ( 18% ) No problems ( 12% )

Slowly, bit by bit, some Republicans are stepping away slightly from the pledge not to increase taxes. The pledge, created as a way to get candidates on the record in an election year, was put forth by activist Grover Norquist's Americans for Tax Reform group. And while no one has outright said they will dis-avow their previous stance, several now say it is not a barrier to compromise. Southern Tier Republican Tom Reed has said he was willing to increase federal revenues. But, it would have to be through putting limits on tax deductions "I think at this point in time we need to avoid the fiscal cliff. and I think it's clear in the house that we are willing to consider revenues..and targeting the top two percent, the millionaires, wherever that wealthy line is drawn," --Congressman Tom Reed, on WBEN's Hardline program November 18. "But we need really need to solve the problem, and that's the spending side of the ledger.  And we need a commitment that when they raise revenue, when we consider revenue, that they are going to apply it to the debt, because the president has promised at least 12 different constituencies that additional revenue." From Hardline (The WBEN Politics Program, Sunday 10a- 12noon) Other recent examples of the GOP shift on the Norquist pledge are Senators Lindsey Graham of South Carolina, Saxby Chambliss of Georgia, and John McCain of Arizona. They've all said they are willing to bend the pledge; but, they had stipulations for Obama and the Republicans, including  another trillion in negotiated spending cuts over the next several years. "It's fair to ask my party to put revenue on the table" as part of the solution to avoid the looming automatic tax increases and across-the-board spending cuts"   --   Sen. Lindsay Graham, (R- South Carolina) Graham told ABC's "This Week" that "for the good of the country," he's ready to violate an anti-tax pledge followed by most Republicans if Democrats agree to big changes in entitlement programs. Graham said he's "willing to generate revenue" by steps such as capping tax deductions, which he says would most affect upper-income Americans. But he says he won't agree to higher taxes - a position shared by most Republicans in Congress. Rep. Peter King, R-N.Y., said a pledge signed years ago should not necessarily apply in economic conditions that have changed greatly. "I think everything should be on the table," he said, adding "I'm just saying we should not be taking ironclad positions."

A freshman GOP senator is jumping into the debate on how to avoid a "fiscal cliff" of tax hikes and automatic spending cuts, advocating a mix of tax increases with curbs on Social Security and Medicare benefits.

Tennessee Sen. Bob Corker is circulating a 10-year, $4.5 trillion plan loaded with controversial proposals, including a less generous inflation adjustment for Social Security, and a gradual increase in the regular Social Security retirement age to 68 and the Medicare eligibility age to 67.

Corker's plan also includes $749 billion in higher tax revenue claimed by capping itemized deductions at $50,000, a proposal that hits wealthier taxpayers the hardest.

Corker has yet to attract any Democrats in support.

But he's a rarity on Capitol Hill in that he's offering specific spending cuts and tax increases instead of vaguely-worded bromides about how to tackle the country's deficit woes.

Corker offered a broad outline of the 242-page measure on the editorial page of Monday's Washington Post.

A more detailed summary circulating on Capitol Hill contains a fuller description, including higher Medicare premiums for upper-income earners and new revenue from Medicare co-payments and deductibles.

Federal workers would get hit with higher contributions to their pensions and would receive an $11,000 voucher payment to finance their family's health insurance, saving taxpayers about $7 billion a year.

Corker's plan is a longshot. For starters, he rejects the idea of settling for a "down payment" on the deficit that would be used to punt the big decisions on the budget to next year, even though that's the recommendation of Boehner.

And his plan is tilted to painful choices on Social Security and Medicare that Democrats are unlikely to embrace.

"Kicking the can down the road - setting up a process for token deficit reduction today with the promise of more reforms later - is misguided and irresponsible and shows a total lack of courage," Corker says.

The White House insists that instead of limiting deductions, any budget solution must include higher tax rates on upper-income earners.