Those observing the ongoing negotiations over the fiscal cliff always hoped that, at the end of the day, both political parties would fulfil their fiduciary duty and develop an amenable solution. Unfortunately, the realities of partisan politics reared their ugly heads on Thursday, as Republican House Speaker John Boehner (R-OH) announced that the hoped-for vote on "Plan B," his alternative solution to the cliff, would not take place. Instead, the House of Representatives voted for a bill that would remove the sequestration spending cuts and replace them with far steeper changes to federal domestic policy initiatives.
According to news reports, including one from The Associated Press, the events that took place on Capitol Hill ahead of the announcement seemed to indicate that the "Plan B" vote would be held as scheduled. However, purportedly tense negotiations between the moderate and conservative factions in the House Republican caucus failed to gather enough votes to ensure passage. It was then that, in a bid to avoid a public and potentially market-shattering failure, the majority leadership team sent out a quick, terse message that explained the cancellation.
"The House did not take up the tax measure today because it did not have sufficient support from our members to pass. Now it is up to the president to work with Senator Reid on legislation to avert the fiscal cliff," Boehner was quoted as saying in a press statement. "The House has already passed legislation to stop all of the January 1 tax rate increases and replace the sequester with responsible spending cuts that will begin to address our nation's crippling debt. The Senate must now act."
The U.S. Senate, which is convening on Friday afternoon, currently is not scheduled to deliberate on the fiscal cliff. When legislators return to Washington next week, however, they can expect to have their work cut out for them.
With the fiscal cliff negotiations entering a dangerous and potentially unrecoverable period, it's vital for those with a financial stake in the U.S. economy to take every step necessary to protect themselves. Whether you're entering retirement or overseeing an investment portfolio, the fiscal cliff has the potential to do serious damage to your wealth. To learn about tips and methods for avoiding this nightmare scenario, visit GreatWealthStratgies.com and download your own "Free Game Plan Report" today.