Lawmakers Head Back to Work With Fiscal Cliff Looming

As lawmakers get back to work this week since breaking for their monthlong recess until Election Day, striking a deal on the fiscal cliff will be on the top of their minds.

Lawmakers, economic gurus and political pundits are voicing their optimism that some type of solution can be reached. As PIMCO CEO Mohamed El-Erian told “Bloomberg Surveillance” on Friday: “No one in their right mind would push our country into recession.” El-Erian said that “the major issue for us is not that we resolve the fiscal cliff but do we do it in a way that allows Washington to pivot to turning headwinds into tailwinds.”

Joe Lieber of Washington Analysis says that much of the real work, however, “will take place behind closed doors as negotiations begin,” with “bicameral and bipartisan leadership” already being summoned to the White House on Friday “to begin laying the groundwork for a potential compromise.”

Prior to the Friday meeting, President Obama plans to hold a series of fiscal-cliff themed meetings throughout the week “with everyone from the heads of progressive groups to business leaders,” Lieber notes.

Even House Speaker John Boehner, R-Ohio, told members of his party after Obama was re-elected that they needed to fall in line. The New York Times reported that on a conference call after Election Day, Boehner told House Republicans that their party “lost, badly” and that “while Republicans would still control the House and would continue to staunchly oppose tax rate increases as Congress grapples with the impending fiscal battle, they had to avoid the nasty showdowns that marked so much of the last two years.”

But Lieber notes in his “Washington This Week” analysis that even if Republicans “have appeared somewhat more conciliatory on taxes in the days following the elections, we continue to believe that any proposals that include an increase in tax rates are a likely non-starter. That said, GOPers from Speaker of the House John Boehner (R-OH) to Sen. Bob Corker (R-TN) have acknowledged that new revenues via eliminating deductions and exemptions will be necessary.”