US Politics Audio: Why The Deal on the "Fiscal Cliff" Is Not That Big a Deal --- Scott Lucas with the BBC
I think I took the presenter of BBC World Service's World Update by surprise when I held back on proclaiming the overnight agreement in Washington as either a big step away from a "fiscal cliff" or an unqualified victory for President Obama.
Listen to the interview from 26.41
The reason? The settlement, which includes a repeal on Bush-era tax cuts for those making over $450,000 per year and extended funding for some programmes --- such as farm subsidies and benefits for long-term unemployed --- due to expire is only a short-term "fix". In large part, that is because of the "problem of the temporary", identified by Lee Haddigan yesterday: many programmes and tax provisions are approved of a rolling basis, rather than establishing long-term plans and strategy.
So if there is a real "cliff" here, it is the one that arises at the end fo February, when the Federal Government hits its debt ceiling and cannot borrow any more money without an agreement between the White House and Congress. Any victory that the President might claim --- and I think that is a limited claim, given that he had promised a repeal of tax cuts for those making more than $250,000 per year and that he gave way on estate tax --- is political posturing, in the face of that battle that is ahead.
The item begins at the 26.41 mark.