House Minority Leader Nancy Pelosi told reporters Dec. 13 that a deal must be in place by “early next week” if Washington intends to avoid a Dec. 31 deadline for passing legislation that would avoid the so-called fiscal cliff. (Chip Somodevilla / Getty Images)
President Obama and congressional leaders must strike a deal in “the next couple days” if they hope to avoid fiscal chaos and deep cuts to Pentagon spending, said House Minority Leader Nancy Pelosi.
The California Democrat told reporters a deal must be in place by “early next week” if Washington intends to avoid a Dec. 31 deadline for passing legislation that would avoid the so-called fiscal cliff, which includes identical $500 billion cuts to planned defense and domestic spending.
It is increasingly apparent that Congress will be in session for much of December.
“We don’t know if we’ll be home for Hanukkah or Christmas,” Pelosi told reporters during a Dec. 13 press conference on Capitol Hill.
The previous day, House Speaker John Boehner, R-Ohio, reportedly told members of his caucus to avoid making plans for Christmas week because they likely will be needed in Washington to vote on some kind of fiscal legislation.
Sources and analysts say what Obama and congressional leaders are most likely to agree to in coming weeks is a framework deal that extends some tax cuts, delays the defense and domestic sequester cuts, and sets the table for a big fiscal deal by next summer.
To that end, Pelosi called for the negotiators to pass a smaller fiscal package this month, then tackle big issues such as reforming the federal tax code and cutting entitlement programs next year.
Reducing the massive federal deficit by $1.2 trillion is the lone way Congress and Obama can avoid the defense cuts, which would be applied to non-exempt accounts over a decade.
Sources say the deal that’s likely to emerge by next week would include language delaying the defense and domestic cuts for a few months while the tax and entitlement issues are discussed.
“We are coming down to the wire,” Pelosi said, adding it is time for Obama and the leaders to “politically engineer a solution.”