House Republicans balk at "fiscal cliff" deal
By Rachelle Younglai and Thomas Ferraro
WASHINGTON (Reuters) - Last-minute efforts to step back from the "fiscal cliff" ran into trouble on Tuesday as Republicans in the House of Representatives balked at a deal that would prevent Washington from pushing the world's biggest economy into a recession.
House Republicans complained that a bill passed by the Senate in a late-night show of unity to prevent a budget crisis contained tax hikes for the wealthiest Americans but no spending cuts. Some conservatives sought to change the bill to add cuts.
That would set up a high-stakes showdown between the two chambers and risk a stinging rebuke from financial markets that are due to open in Asia in a few hours.
The Senate would refuse to accept any changes to the bill, a Senate aide said, and it appeared increasingly possible that Congress could push the country over the fiscal cliff after all, despite months of effort.
Strictly speaking, the United States went over the cliff in the first minutes of the New Year because Congress failed to produce legislation to halt $600 billion of tax hikes and spending cuts that start kicking in on January 1.
But with financial markets and federal government offices closed for the New Year's Day holiday, lawmakers had a little more time to work out a compromise without real-world consequences.
The Senate bill drew overwhelming support from Republicans and Democrats alike when it passed by a vote of 89 to 8.
But Republicans who control the House expressed wide dismay with the measure, which includes only $12 billion in spending cuts along with $620 billion in tax increases on top earners. Continued...