For the first time in over three weeks, President Obama and House Speaker John Boehner looked each other in the eye and actually had a conversation! This meeting comes at a very important time because in just 22 days Americans face severe tax hikes and spending cuts unless these two leaders can find a way to compromise. Neither side would discuss specifics but after yesterday's white house meeting a spokesman for the president said – quote – "the lines of communication remain open." This morning, Rep. Judy Chu (D-CA) joins “Starting Point” to weigh in on the fiscal cliff and the recent meeting between the president and Speaker Boehner.
Chu says she, “was encouraged to see the meeting between Speaker Boehner and President Obama” and she “really feels a deal has to be made.” She adds “a deal is to be made that would benefit the people if it were done earlier.”
Chu says, “we need discussion right now…and we need to have a discussion where we could have sensible solutions with regard to the safety net programs as well as the tax cuts.”
On the topic of what democrats will bring to the table Chu says, “Something that should have been done a while ago” is a “ change to Medicare in which we can actually negotiate for drug prices. After all we do it for Medicaid. Why can’t we do it for Medicare? That would be a big savings to the Medicare program.”
For the first time in a week, President Obama and House Speaker John Boehner spoke about the fiscal cliff over the phone, but there’s no word of progress made or future talks planned with only twenty-six days to go before the fiscal cliff.
Rep. Steve LaTourette (R-OH), who is a member of the Appropriations Committee, believes that there’s a growing sense in the Republican party that “the President has won this round relative to the rates” but they still need to sit down and work out the spending part of the deal, which he feels can be reached if the President moves forward with entitlement reform.
LaTourette comments that the Republicans’ walk out yesterday, heading home because there are no votes between now and the weekend, is not as significant as it appears. “We’re not doing anything to get this done because there’s nothing we can do,” he says. “This is going to be a negotiation between the President of the United States and House Speaker John Boehner.”
With only 32 days until tax rates automatically soar and spending cuts kick in, President Obama has released his proposal for dodging the fiscal cliff, which includes $1.6 billion in tax hikes. Ken Rogoff, professor of economics and public policy at Harvard University, joins “Starting Point” on Friday to argue that a mix of spending cuts and higher taxes are necessary, but that Congress needs to consider the long term costs of entitlement programs for any long-lasting solution to the debt crisis.
“Entitlement is the big, looming problem,” the Harvard professor argues. “It is a long-term problem every year. It's likely to get worse as we age. Medical care costs go up. That's the big problem.” He adds that “until people feel it’s fair, and they’re nowhere near feeling it’s fair, [the cuts] are not going to happen.”
Rogoff also says that while he believes the wealthy will need to pay higher taxes, the middle class will also “need” to pay more unless there’s “organic growth that just makes us boom for 20 years.” “We don’t have that,” he says.