Fiscal Cliff Avoided?

The nation narrowly has avoided falling off the so-called fiscal cliff, at least for a brief time.

Congress retained most tax cuts and cut some spending but continued to put off deeper cuts. The House of Representatives remains deeply divided and at odds with the president but still passed tax increases for the wealthiest Americans, a cornerstone of President Barack Obama’s campaign.

Maryland Sen. Ben Cardin said that going off the fiscal cliff would have been “devastating” to Maryland and the nation and called the bill “a true compromise” that most importantly gave “permanent tax relief to middle-income families.”

Congressman Elijah Cummings said, “This fiscal cliff deal was a necessity” that protects tax breaks for the middle class and extends unemployment benefits, and he called it “a balanced approach to debt reduction that makes additional demands of the wealthiest among us.”

Cardin and Cummings were joined by all Maryland Democrats, while House Republicans Andy Harris and Roscoe Bartlett voted no. Harris said the bill was “business as usual in Washington and does nothing to deal with the real fiscal cliff — our $16.4 trillion deficit. In fact, it adds almost $4 trillion to the debt.” Majority Leader Eric Cantor (R-Va.), the only Jewish Republican in Congress, voted against the legislation.

Congress voted to maintain tax cuts to all but the wealthiest Americans, continue unemployment and Medicare benefits and forestall across-the-board cuts in spending, otherwise known as sequestration. Congress did not act to raise the impending debt ceiling or extend a Social Security tax break that will result in a reduction in take-home pay for most Americans.

President Obama wants to continue reducing the deficit and pointed out that “the aging population and the rising cost of health care makes Medicare the biggest contributor to our deficit.”  He cautioned that we “can’t continue to cut our way to prosperity” and stressed the need for a balanced approach through both revenue increases and spending cuts.

Nearly everyone is left dissatisfied for one reason or another, even though no action would likely have made it worse for many Americans. While the Jewish Federations of North America (JFNA) views the congressional action positively, Board of Trustees Chair Michael Siegal remarked, “We know the fiscal debate isn’t over, and as this fight continues, federations will continue to work with coalition partners to ensure utmost protections for those at risk.”

In a Jan. 1 statement, the Jewish Council for Public Affairs expressed its frustration with the inability of government leaders to appropriately address our many budget and fiscal challenges.

“It is a fitting end for the Congress, which has been notoriously unproductive,” said JCPA President Rabbi Steve Gutow. “As the details of the compromise continue to emerge, we remain concerned about the future of many important programs that support the most vulnerable and provide pathways to prosperity for millions of Americans, including WIC [Women, Infants and Children] and Head Start.  We look at today’s bipartisan effort as not just a quick swerve to avoid the most severe effects of the fiscal cliff, but also as an opportunity for a new course.”

B’nai B’rith, which also expressed reservations about the work left undone, including potential cuts to Medicare and Medicaid, was specific about its support in one area. “Ensuring seniors have access to doctors by stopping a cut in reimbursements to those who treat the elderly is a vital element of this bill,” said B’nai B’rith International President Allan J. Jacobs.

“We certainly hoped Social Security would be left out because it is self-funded and doesn’t contribute to the deficit, but we have reason to be concerned about that as well,” said B’nai B’rith International Associate Executive Vice President Mark D. Olshan.

Bend the Arc Jewish Action called the House bill “imperfect yet nonetheless one worth supporting. It included the first bipartisan agreement to raise taxes on the wealthiest Americans in 20 years and clearly established the principle that deficit reduction cannot and should not be achieved purely by cutting spending.”

Director Hadar Susskind said his group will continue to advocate for and lobby lawmakers “to keep our communal and national responsibilities at the forefront of their thinking and to refrain from undercutting the social safety net, which plays such a crucial role in helping Americans living in poverty and those struggling to stay out of poverty.”

“We are pleased that Congress and the president were able to come together on the fiscal cliff,” said Cailey Locklair of the Baltimore Jewish Council. “However, we are concerned about the future of the charitable contribution deduction at both the federal and state levels, as this will not be the last time we hear this conversation.”

Both Cummings and Cardin noted the important work ahead.

“Outstanding issues like the deep spending cuts pending under sequestration — which have been delayed for only two months — require our immediate attention to prevent catastrophic impacts in Maryland and nationwide,” said Cummings.

Cardin pointed to three major challenges in the weeks ahead: sequestration and across-the-board cuts; the need to extend the debt ceiling to pay for debts already incurred; and a temporary spending bill for appropriations for the remainder of the year. Cardin noted the crucial role that Maryland Sen. Barbara Mikulski will play as the new chair of the Appropriations Committee.

Said Gutow: “Enactment of this legislation is a large step but only a single one in the process to place the United States on a more sustainable fiscal path.”

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