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Republicans Signal Willingness for Flexibility on Revenues

Sens. Lindsey Graham, R-S.C., and Carl Levin, D-Mich.; photo by Bill Clark/CQ Roll Call

Sen. Lindsey Graham, R-S.C., left, and Sen. Carl Levin, D-Mich., both spent Sunday talking about increasing revenue. Photo by Bill Clark/CQ Roll Call.

The Morning Line

President Obama and congressional leaders are expected to resume negotiations in the coming days with the aim of averting the so-called “fiscal cliff” set to arrive in just over five weeks’ time.

Judging by discussions on the Sunday talk shows, it appears some Republicans are willing to meet the president and his Democratic allies at least part way when it comes to revenues.

Sen. Lindsey Graham, R-S.C., said he was “willing to generate revenue” but remained opposed to raising tax rates.

“I will cap deductions. If you cap deductions around the $30,000, $40,000 range, you can raise $1 trillion in revenue, and the people who lose their deductions are the upper-income Americans,” Graham said during an appearance on ABC News’ “This Week.”

That position, however, puts him at odds with Grover Norquist, founder and president of Americans for Tax Reform and author of the “Taxpayer Protection Pledge”, which many Republican lawmakers have signed.

“I agree with Grover, we shouldn’t raise rates, but I think Grover is wrong when it comes to we can’t cap deductions and buy down debt,” Graham said. “I want to buy down debt and cut rates to create jobs, but I will violate the pledge, long story short, for the good of the country, only if Democrats will do entitlement reform.”

Rep. Peter King, R-N.Y., joined Graham in talking down the anti-tax pledge, rejecting “ironclad positions” in negotiating a compromise package on the deficit.

“A pledge you signed 20 years ago, 18 years ago, is for that Congress,” King told NBC News’ “Meet the Press.”

King added: “For instance, if I were in Congress in 1941, I would have signed a declaration of war against Japan. I’m not going to attack Japan today. The world has changed. And the economic situation is different.”

Sen. Bob Corker, R-Tenn., joined the chorus Monday, telling CBS News that he was “not obligated on the pledge.”

But Democrats signaled that Republicans would need to accept higher rates and not just additional revenues if a deal was going to happen.

“Let the rates go up to 39 percent,” Senate Majority Whip Dick Durbin of Illinois said on ABC. “Let us also take a look at the deductions. Let’s make sure that revenue is an integral part of deficit reduction.”

Sen. Carl Levin, D-Mich., expressed a similar viewpoint on NBC. “You’ve got to raise additional revenues, including tax rates on the wealthy,” he said.

The Obama administration sought to drive home the point Monday with the release of a report from the National Economic Council and the Council of Economic Advisers showing how consumer spending and retail sales would be impacted if taxes on middle-class Americans were to increase on Jan. 1.

Among the findings from the report:

Faced with these tax hikes, the CEA estimates that consumers could spend nearly $200 billion less than they otherwise would have in 2013 just because of higher taxes.

For his part, Durbin indicated Democrats should be willing to put entitlement reform on the table if Republicans agreed to higher tax rates.

“Social Security, set aside. Doesn’t add to the deficit,” Durbin argued. “But when it comes to Medicare and Medicaid, protect the integrity of the program, but give it solvency for more and more years.”

Until the question over tax rates can be resolved, however, piecing together the rest of the fiscal puzzle, including entitlement reform, will likely remain unsolved.


In their weekly segment, Mark Shields and David Brooks hit on nearly every other major political issue of the past week except the fiscal cliff.

They commended Mr. Obama for making the 3 a.m. phone calls that helped bring a ceasefire between Israel and Gaza, mused about Graham’s prominent role in criticizing ambassador Susan Rice, and they looked back at the career of Rep. Jesse Jackson Jr., D-Ill.

Watch the segment here or below:


Judy Woodruff kept up the NewsHour’s discussions with incoming senators, speaking with Sen.-elect Tim Kaine of Virginia.

After winning 2012’s closest and most expensive U.S. Senate race, the former Democratic governor met with freshman senators last week, where discussion revolved around policy areas where the parties could find common ground. “There are always areas of agreement if you listen and if you work hard enough to find them,” Kaine told Woodruff. “And that is what the American public wants us to do.”

Last year, Kaine proposed letting the Bush era tax cuts expire for those making over $500,000. “The Democrats position has been tax cuts to expire over 250, the Republican’s position has been make all the tax cuts permanent,” explained Kaine. “There isn’t anything theological about the 500,000 number, it’s just a compromise.”

Watch the conversation here or below:


Monday’s tidbit from NewsHour partner Face the Facts USA boils down the Bush-era tax cuts into a few simple infographics:

Government figures estimate those cuts added $1.75 trillion to the federal deficit from 2002 to 2011. Tax cut advocates say it’s worth it – allowing people to spend that money and stimulate the economy.

The nonpartisan organization has retooled post-election to offer new facts tied to the news.


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  • The Associated Press picks up on Sen. John McCain and Graham’s Sunday talk show comments as a change in tenor on ambassador Susan Rice.

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  • Jonathan Weisman of the New York Times writes about the Senate’s “long slide to gridlock.”

  • Some states are asking for more information on the campaign spending habits of non-profit groups, the Los Angeles Times reports.

  • The former congresswoman whom Jackson beat in a March primary will run in the special election for his open seat. NewsHour production assistant Alex Bruns has more on Jackson’s resignation.

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  • The Hill outlines the National Republican Senatorial Campaign Committee strategy for 2014.

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Watch the segment here or below:

  • If you’re sick of leftovers yet still enjoy a live bird or two, we’ve got all the turkey pardons you could ask for — from video of Mr. Obama’s ceremony to a slide show of governors celebrating the fowl.

  • NewsHour desk assistant Geoffrey Lou Guray took a look at the 2013 gubernatorial contests in New Jersey and Virginia, where Sen. Mark Warner decided he will not seek another term — this time. (Roll Call’s Kyle Trygstad used the news to look ahead at the 2014 Senate race. Could it be Warner vs. Bob McDonnell?)

  • Paul Solman tackles the history of the Plymouth Colony and economics in this post.

  • Judy settles the final score on this year’s election with a post in her blog series, Judy’s Notebook.


Christina Bellantoni and Jessica Fink contributed to this report.

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