Saturday, December 29, 2012 12:41 AM
Rep. Butterfield: We'll fall off fiscal cliff
Wilson County's congressman weighs in amid calls for compromise
By Corey Friedman | Times Online Editor
Wilson County’s congressman thinks the United States will tumble over the fiscal cliff on Jan. 1, but if he has his way, the middle-class tax hikes will be short-lived.
Rep. G.K. Butterfield said eleventh-hour bickering has tempered his optimism for a deal between Democrats and Republicans to avoid the combination of tax increases and across-the-board spending cuts.
"I’m not optimistic that there will be a grand bargain that conservatives and progressives can agree on, I really don’t,” Butterfield said. "I suspect the fiscal cliff will happen. I was optimistic until about two weeks ago, and then my optimism began to fade.”
Butterfield, a Wilson Democrat representing North Carolina’s 1st Congressional District, was driving back to Washington on Friday afternoon in preparation for last-minute fiscal cliff votes on Capitol Hill. Congressional leaders met with President Barack Obama at the White House Friday to hammer out a deal.
In summer 2011, Congress passed — and Obama signed — a law that would require about $917 billion in budget cuts over the next decade in exchange for increasing the U.S.’ debt ceiling. The law triggers sequestration, or automatic cuts of about 8 percent to every federal agency, if Congress fails to pass a plan with specified cuts.
The George W. Bush tax cuts already were set to expire on Dec. 31. Democrats insist that any fiscal cliff bargain must include phasing out the cuts for families earning more than $250,000 per year. Republicans are reluctant to increase tax rates and prefer a combination of deep spending cuts and tax reform that would raise some revenue by closing loopholes and eliminating deductions.
"People can expect to have less disposable income, and it’s all because Republicans do not want to raise taxes on those couples making more than $250,000 a year,” Butterfield said. "It’s a shame.”
If lawmakers can’t make a deal, the Bush tax rates would expire for all earners. Butterfield said he wants to make the lower rates permanent for everyone who earns less than a quarter-million dollars.
"We want to take rich people back to the rates they were paying when President (Bill) Clinton was in office,” he said. "For 98 percent of the taxpayers, we want to lock you into low rates and make it permanent.”
Republicans counter that raising tax rates on the wealthy will discourage job creation and investment.
Butterfield predicts the Bush tax cuts will automatically expire on Jan. 1 as a result of sequestration, but Senate Democrats will try to pass a bill restoring the cuts for all but the wealthiest 2 percent of taxpayers.
"If the Republicans vote against that, they are voting against a tax decrease,” he said. "I think Republicans in the Senate would have to accept and vote for a tax decrease.”
CALLS FOR COMPROMISE
Butterfield may be pessimistic about the fiscal cliff, but he’s still working feverishly to avert it, he said. He favors a compromise under which Democrats would agree to bigger spending cuts and Republicans would be willing to raise taxes on the wealthy.
"Reasonable people must come together to reach a compromise,” he said. "Republicans are going to have to compromise and raise the rates on wealthy taxpayers. Democrats are going to have to compromise and realize we’ve got to have more cuts.”
Each of North Carolina’s senators agree that compromise is needed, but they offer divergent perspectives on how such a deal should look.
Sen. Richard Burr, a Republican, favors tax reform over tax increases as a means to generate revenue.
"If we are serious about addressing our nation’s financial problems and avoiding the fiscal cliff, one of the first and most important things we must address is our broken and burdensome tax code,” Burr said in a message on his website. "We need to simplify the tax code, eliminate tax loopholes and lower rates so that small businesses can grow and families get a break. Raising taxes — on anyone — will not address the deep, fundamental problems in our tax system.”
Burr said Republicans are willing to accept more tax revenues, but Democrats are dragging their feet when it comes to cutting spending.
"Democrats have been unwilling to put a serious deficit reduction offer on the table so far, and the president’s most recent proposal includes another round of stimulus spending that will cost taxpayers $50 billion in the next year alone.”
Sen. Kay Hagan, a Democrat, said she supports a bipartisan solution to avoid the fiscal cliff.
"If we don’t act, the average middle-class family will see their taxes increase by $2,200,” Hagan said in a prepared statement. "That’s unacceptable. On top of that, the consequences of sequestration are amplified in our state given our large military footprint and the economic importance of the defense industry to our local economies.”
LOCAL LAWMAKERS WEIGH IN
Though the N.C. General Assembly can’t fix the impasse in Washington, state lawmakers representing Wilson County have no shortage of ideas.
State Rep. Jean Farmer-Butterfield, a Wilson Democrat, suggested passing a temporary measure to keep current tax and spending levels in place while lawmakers continue to seek a permanent solution.
"They just need to come up with a compromise and work it out,” she said. "Put the people first instead of egos and parties. If they absolutely cannot, they probably should pass legislation to keep things moving forward.”
Farmer-Butterfield said Congress should work to balance the budget and avoid adding to a $16.3-trillion national debt. She also supports extending the Bush tax cuts for all but the wealthiest Americans.
"I really have not taken a position on it other than the fact that I think the middle class is paying enough and it’s sufficient,” she said. "If I was in that 1 percent, I would not mind paying my fair share.”
Many Wilson County residents would be in dire straits if tax increases took an extra $50 or more out of each paycheck, Farmer-Butterfield said.
"Some people are telling me they can’t make ends meet as it is with the kind of bills they have,” she said. "Fifty dollars a month may not sound like a lot to some people, but if you’re struggling to make ends meet, it is.”
State Rep. Joe Tolson, a Pinetops Democrat who represents parts of Wilson and Edgecombe counties until new legislative districts take effect Jan. 1, agreed that tax hikes would hobble low- and middle-income families.
"It would probably be devastating to the middle-income people,” he said. "The wealthy people will certainly still feel it, but there would be more pocket pain for the middle class.”
Tolson said both Republicans and Democrats have valid points, but they need to work together and be willing to compromise for the nation’s good.
"We’ve got to do something about the deficit,” he said. "We can’t just keep borrowing money, so we’ve got to get some cuts to bring the spending under control.”
Tolson challenged congressional leaders to bring open minds to the negotiating table.
"I just don’t understand how people can represent the citizens of this country and not work together,” he said. "That’s what’s got to happen in order to keep this country moving forward. Let’s get this country on the right track and put politics aside for a change.”
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