WASHINGTON (CBS) – Even with the deal in Congress to avoid the fiscal cliff, no one in Washington is really celebrating.
Late Tuesday night, the House passed the bill that reversed automatic tax hikes and spending cuts.
But lawmakers put off a vote on those spending cuts by two months. It also doesn’t address the debt ceiling, which the U.S. hit on Monday. The bill also doesn’t extend the payroll tax cut, which means we’ll all see a little less money in our paychecks.
“I’m relieved it finally got done,” said Rep. Bill Keating (D-MA).
Congressman Keating was one of the few members who didn’t bolt Washington after the vote, an exodus that included the president returning to Hawaii to resume his vacation.
Perhaps they’ll all get an earful about the tax deal, the details of which may surprise those who thought it was just the “rich” getting hit.
In fact, the deal ends a two-year break on your payroll taxes, hitting $50,000 a year earners with an extra $1,000 tax bite. If you make close to $114,000 or more, it’s another $2,200-plus out of your paycheck. Individuals with incomes over $400,000 and couples making $450,000 or more will see their income tax rate soar to 39.6%, with the capital gains rate hitting 20%.
And Congressman Keating says the heavy lifting is just getting started.
“The game that is going on with the president and the Republicans right now is ‘all right you tell us where the cuts are going to be made,’ no one wants to identify those cuts,” Keating told WBZ’s Jon Keller. “In two months the sequester takes effect again, and we are going to have to identify where those cuts are and that’s a tough decision.”
“What I’ve seen in just my short time here is, wait for the crisis, let the crisis force the action,” says Keating. “We can’t continue to do that, and we won’t be able to do that because we are looking at a two-month window.”