Dear Friend,

I wrote you a couple weeks ago about the status of fiscal cliff negotiations, and I wanted to give you update.  

We have just days to reach a compromise if it is to be voted on before Christmas, and less than three weeks before we go over the cliff.  The President and the Speaker of the House have been meeting more often, but big questions and big disagreements remain.  Time is running short, but I am hopeful that a deal can be reached.

The fiscal cliff poses a major threat to our economy, but good things can and should come from these negotiations.  For too long, Congress has governed through patches and punts rather than solving the serious issues that confront us.  Divided government has made it difficult to tackle our long term problems, so we’ve been forced to resort to short term fixes.

It is possible that, at least initially, we will avert the fiscal cliff through a short term agreement to buy time for the next Congress to work on a much more comprehensive solution.  I’d rather we reach a big agreement now, but either way, many big issues that have long needed attention will likely be addressed by a compromise.

The question is how well we will address these issues.  The biggest problem that we need to confront is our overspending as a nation.  While many families have reigned in their spending to make ends meet during the recession, Congress should be in the position to do the same.  Much of the debate around the fiscal cliff has been based on how much more money needs to be brought in through tax revenues.  We can’t lose sight of the fact that the real problem is not how much money the government brings in, but rather how much it spends.

Even if the President got all the tax increases he wants, just $80 billion more would be brought in next year in taxes.  During the same time period, the federal government will run a deficit of at least $900 billion.  Higher taxes would do very little to address long term deficits.

A real solution requires that we take the reality of our financial situation into account and make responsible spending cuts.  We also need to reform our nation’s entitlement programs so they are there for future generations to utilize. 

It is important to root out wasteful spending so that we don’t have to cut from things that matter most -- like our national defense.  As I’ve said in previous newsletters, the burden of spending cuts shouldn’t be falling primarily on defense.

For that reason, it’s important that we find alternative spending cuts to replace defense sequestration cuts – the automatic defense cuts that are scheduled to hit at the beginning of next year.  The House of Representatives has already voted on a bill to make these replacement spending cuts, and there’s some talk about voting on the bill again in the near future.

There is bipartisan consensus in Congress that defense sequestration cuts are a dangerous idea, and President Obama has said the same.  It is time for the Senate and the President to take up the replacement cuts passed by the House, and stop harmful defense cuts.  Doing that will be an important part of any fiscal cliff compromise.

The bottom line is, if we do it right, a compromise offers a real opportunity to address big problems.  America’s leaders owe an effective solution to the American people, who are beginning to feel the pain of the potential cliff.  Small businesspeople are beginning to  slow down investments, families have had to pare back their budgets, and the entire economy has been clouded by uncertainty.

To get to a forward looking compromise, politicians need to stop taking options off the table.  I, along with more than 70 of my colleagues in the House of Representatives recently signed a letter urging leadership to keep an open-mind during negotiations and keep all options on the table.

The input I’ve received from my constituents has been so valuable throughout this process.  As these negotiations continue, know that I am taking into account what I am hearing from you and I won’t stop working for a positive solution.



Kay Granger
Member of Congress