Obama's big test: breaking Congressional gridlock to avert "fiscal cliff"

2012-11-29 06:40:11 GMT2012-11-29 14:40:11(Beijing Time)  Xinhua English

U.S. President Barack Obama's first big test after re-election is averting the impending "fiscal cliff," a feat he cannot pull off without reaching across the cavernous partisan gap and working with opponents in Congress.

The "fiscal cliff," the tax hikes and spending cuts due to kick in at yearend if Congress and the White House cannot agree on a budget, could spark another recession even as the economy struggles to recover from the worst downturn in decades.

At issue is whether Democrats and Republicans can agree on taxes on upper income earners. Obama wants to increase their tax rates, arguing they must pay their fair share, while Republicans contend upper earners are the economy's driving force and taxing them will hurt an economy that continues to struggle toward recovery.

Agreeing on anything, let alone such a major issue, will be no easy task, as Congress remains bitterly divided after a presidential election earlier this month that left much unchanged, with Republicans still controlling the House, Democrats still comprising the Senate majority and Obama still in the White House.

Hammering out an agreement will require strong leadership from the White House, but critics charge Obama with shirking his leadership roll. Opponents say Friday's planned trip to the Philadelphia area in a bid to drum up support for an upper income tax hike shows Obama is in permanent campaign mode.

"I think he should get off the campaign trail and spend his time at the White House," said former Republican Senator from Ohio George Voinovich at a Brookings Institution panel Wednesday.

"The real issue about gridlock is going to be based on how he (Obama) handles this fiscal cliff," he continued, "I think he should tell the American people 'this is very serious business... and I'm going to spend as much time as I can with the members of Congress'. He's also got to reach out and build on his relationship with (House Speaker) John Boehner."

For its part, the White House maintains that Congressional Republicans have time and again refused to compromise on virtually every issue, which has stalled Congress.

Speaking on the same panel, Phillip Wallach, a research fellow at the Brookings Institute, said compromise will not be easy as neither side will get everything they want and each will have to give up something.

"Moving from 3 percent to 2 percent GDP growth every year means we have to temper some expectations about what we can afford," he said, "So to make this big deal work realistically it's going to take both sides understanding that they're not going to get everything they want. And that's going to take leadership on both sides."

Still, there are some bright spots on the horizon, Wallach said.

"The president has said a lot of encouraging things... and it will take him standing up to his party and House Speaker Boehner standing up to his party," and accepting a deal, he said.

On the Republican side, the Tea Party caucus, known to take a my-way-or-the-highway approach, comprises only 68 members which is a minority. That could make it easier for Boehner to come to the negotiating table, Elaine Kamarck, lecturer at Harvard's Kennedy School, told the panel.

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