The News Desk is a collection of news, notes and breaking items affecting the Fredericksburg community.
Kaine says he’ll work for compromise
BY CHELYEN DAVIS
RICHMOND—Virginia’s new U.S. senator-elect, Tim Kaine, said his first priority will be working to find bipartisan compromise on looming fiscal problems.
But some of them need to be solved before Kaine even takes office.
The so-called “sequestration” cuts of $1.2 trillion, put in place last year by lawmakers as part of a debt deal, will kick in in January unless Congress acts before then to stop them. They weren’t meant to actually happen, but instead to be a threat to spur Congress to find more palatable budget cuts, which never took place.
Also in January, the “fiscal cliff” hits—that’s the shorthand term for the automatic ending of a number of tax cuts, including the Bush-era income-tax cuts, President Barack Obama’s temporary payroll-tax cuts, and certain tax cuts for businesses, if Congress doesn’t act to extend them.
Congress has been at a standoff for months over how to resolve both issues. The campaign trail halted progress while politicians ran for re-election and waited to see whether the players would change—whether a different president would be elected, whether the Senate would turn Republican.
But neither happened—Obama is still president, the Senate is still Democratic and the House is still Republican.
At a Wednesday press conference in Richmond, Kaine—who beat Republican George Allen in the race Tuesday—said that while he won’t be in office until January, he hopes to encourage a lame-duck Congress to work to avert those upcoming budget cuts and tax increases.
Kaine said he wants “to be part of a solution team” to get the nation’s “fiscal house in order.”
“I’m going to continue to advocate a basic set of compromises,” Kaine said.
Allowing the sequestration cuts and the tax-cut expirations to go forward, he said “would send a very bad signal” about Congress’ ability to work together and to repair the economy.
Kaine made bipartisanship and compromise a centerpiece of his campaign and said the election results mean that the electorate wants lawmakers to find common ground.
“The key is for us in public office to read the message from the electorate,” Kaine said. “They want cooperative government. They are telling us over and over again they want us to work together.”
Gov. Bob McDonnell also said Wednesday that the sequestration and fiscal-cliff issues will require both parties to compromise and “find common ground for the people.”
“Washington is just dead broken,” he said at a press conference. “We’ve got to stop the hyper-partisanship, stop the blame game and work together. People in both parties have got to say, ‘OK, campaign’s over.’ They’re going to have to do it soon. There’s a lot of serious work to do before this new Congress is even sworn in. Both sides can’t win and just do what they want to do.”
It wasn’t clear Wednesday how lawmakers in Washington—entrenched for months on their separate sides on these issues—would shift toward compromise.
In a statement, House Majority Leader Eric Cantor, R–7th, said Democrats shouldn’t see Obama’s re-election as a call for tax increases.
“I hope President Obama responds to this election by making an effort to work with Republicans. There is no mandate for raising tax rates on the American people,” Cantor said. “There is a mandate for avoiding the fiscal cliff and finding real solutions so we can make life work for people again.
“Higher tax rates won’t create jobs and they won’t solve our spending crisis. Massive defense cuts won’t make us safer and won’t support our troops. Ignoring the problems of Social Security, Medicare and Medicaid won’t help people get better health care or prepare for a secure retirement. The fiscal cliff is looming, and we must provide real solutions, or face dire consequences.”
But also yesterday, The Associated Press reported that House Speaker John Boehner was open to tax increases “under the right conditions,” those conditions including broader tax reforms that make the tax code simpler, eliminate loopholes and reduce tax rates.
For states like Virginia, the re-election of Obama and a Democratic majority in the Senate mean facing the fact that the federal health care law is here to stay.
In Virginia, McDonnell had stalled on moving forward with decisions about how to implement the law in part because there was a chance Mitt Romney would win the presidency, and Romney had vowed to overturn the Affordable Care Act.
Now Virginia must decide whether to create a state-run health benefits exchange, and whether to expand its Medicaid program to cover more people—both provisions of the ACA.
On Wednesday, McDonnell indicated Virginia won’t do either.
There is a Nov. 16 deadline for states to declare whether they’ll run their own health benefits exchanges or use a federal one, and McDonnell said federal officials haven’t provided enough information about how a state-run program would work for Virginia to choose that option, even though the law is two years old.
It’s expensive to build an exchange, he said, and it’s possible there might be private-sector exchanges that could be cheaper or more efficient.
For now, he said, Virginia will go with the federal exchange, although there are other deadlines and options over the next couple of years that could allow Virginia to change that choice.
McDonnell said he also thinks it would be “irresponsible” for the state to expand its Medicaid coverage unless the federal government initiates “dramatic reforms to cut the cost.”
Medicaid is a joint federal and state program, but the costs to states have ballooned in recent decades; McDonnell called it the largest budget driver in most state governments, and said the cost to expand it under the ACA could be $1 billion to $2 billion over the next decade.
It’s so expensive, he said, that he doubts the federal government can afford to do it any more than states can, at least not without increasing the federal debt.
“I don’t believe the federal government can possibly honor its commitment to the states to fully fund the program,” McDonnell said.
Chelyen Davis: 540/368-5028