Reid, McConnell at odds as lame-duck session opens

WASHINGTON - Majority Leader Harry Reid called the Senate back to work Tuesday for a postelection session, urging lawmakers to embrace a "balance" of spending cuts and tax hikes on the rich to stabilize the economy.

But Republican leader Mitch McConnell of Kentucky served notice the GOP plans to hold President Barack Obama's feet to the fire to come up with a better plan for compromise. 

The comments by the Senate leaders at the outset of the lame-duck session signaled both sides were sticking to their guns as Congress seeks to avert a date at the end of the year with the "fiscal cliff."

Unless Congress passes a budget deal, a combination of tax increases and automatic spending cuts the Congressional Budget Office estimates at more than $600 billion for 2013 would start to take effect in January. The agency has said it fears the economy could be pushed back into recession.

"This Congress is but one vote away from avoiding the fiscal cliff for middle-class families and small businesses," Reid said . "The House must only consider the Senate-passed bill freezing tax rates for those making less than $250,000 a year."

The Senate bill passed by a 51-48 party-line vote in July. For families earning more than $250,000 annually, the legislation means their income tax rate would increase from 35 percent to 39.6 percent, an outcome that Republicans reject.

McConnell said Obama needs to come up with a tax reform plan and changes in Medicare or Social Security that would cut costs, increase revenue and sustain the entitlement programs, while avoiding raising tax rates.

"The president needs to lead," McConnell said. "And that means offering a concrete plan that takes into account the fact that half the Congress opposes tax hikes. Not because we're selfish or stubborn. But because we know it's the wrong thing to do, because we know it will hurt the economy and destroy jobs."

"We will arrive at a plan when the president presents one. Or we won't get anywhere at all," he said. "That's how we get out of this jam. That's what the moment requires. It's the president's move."

Reid, D-Nev., said the Democratic proposal would protect "98 percent of American families and 97 percent of small businesses today."

"If there is a message to take away from this year's election, it is this: Americans are tired of the politics of division," Reid said. "The American people - Democrats and Republicans - want cooperation and conciliation."

Contact Stephens Washington Bureau Chief Steve Tetreault at stetreault@stephensmedia.com or 202-783-1760.