Dec. 27 (Bloomberg) -- The U.S. House will hold its first Sunday session in more than two years as lawmakers seek to resolve a budget impasse before at least $600 billion in spending cuts and tax increases begin Jan. 1.
In a conference call today with the Republican leadership, House members agreed to return Dec. 30 amid a budget stalemate that has each side blaming the other. Markets pared losses following the announcement of the House return, after the Standard & Poor’s 500 Index fell as much as 1.3 percent on mounting concern that no deal would be reached.
“We are coming up against a hard deadline here,” Senate Minority Leader Mitch McConnell, a Kentucky Republican, said on the Senate floor. “This is a conversation we should have had months ago.”
If Congress does nothing, taxes will go up in 2013 by an average of $3,446 for U.S. households, according to the nonpartisan Tax Policy Center in Washington. Tax filing for up to two-thirds of U.S. taxpayers could be delayed into at least late March. Defense spending would be cut, and the economy would probably enter a recession in the first half of 2013, according to the Congressional Budget Office.
Majority Leader Eric Cantor of Virginia, who announced plans for the Dec. 30 session on Twitter, didn’t say what action the House plans to take. He said the House may meet through Jan. 2, the day before the next session of Congress will convene. The House held a brief pro-forma session today although most members weren’t in Washington.
During the conference call, House Speaker John Boehner told fellow Republicans that the Senate should act on House-passed measures that would carry out Republicans’ plan to avert the so-called fiscal cliff, said an aide who sought anonymity to discuss the private conference call.
One lawmaker on the call said several House Republicans agreed with plans for the weekend session, even if only to wait for the Senate to act. The members were concerned that Democrats were winning the public relations battle on the budget talks, said the lawmaker, who requested anonymity to discuss the private session.
The House last convened on a Sunday on March 21, 2010, to vote on President Barack Obama’s health-care legislation. The House has met on 16 Sundays since World War II, according to records of the House clerk and historian’s offices.
Senate Majority Leader Harry Reid, a Nevada Democrat, said the House should back Democrats’ plan to extend expiring tax cuts on income of married couples up to $250,000. Republicans oppose raising tax rates on any income level.
“We know that the Republicans have buried themselves in procedural roadblocks to everything we try to do around here,” Reid said. “Any time the speaker and the Republican leader come to the president and say we’ve got a deal for you, the president’s door is always open.”
The S&P 500 dropped 0.1 percent to 1,418.03 at 4 p.m. in New York, after earlier falling as much as 1.3 percent. Trading in S&P 500 companies was 8.4 percent below the 30-day average at this time of day. The benchmark Treasury 10-year note yield declined three basis points, or 0.03 percentage point, to 1.72 percent at 3:12 p.m. in New York, according to Bloomberg Bond Trader prices.
“I’m neither optimistic nor pessimistic,” Vice President Joe Biden told reporters while leaving the Capitol after swearing in new Democratic Senator Brian Schatz of Hawaii, who succeeded the late Senator Daniel Inouye.
When asked what Obama’s administration is seeking in a potential plan, Biden said, “You tell me what will attract Republican votes, and I will tell you.”
Earlier today, Reid said the budget dispute probably wouldn’t be resolved before Jan. 1 because Republicans wouldn’t cooperate.
“I don’t know time-wise how it can happen now,” Reid said, blaming Boehner and McConnell.
Obama called Reid, Boehner of Ohio, McConnell of Kentucky, and House Minority Leader Nancy Pelosi, a California Democrat, late yesterday to receive an update on the negotiations, said Amy Brundage, a White House spokeswoman. Obama today returned to Washington from his vacation in Hawaii.
“There’s always hope, there are a few days,” Senate Finance Committee Chairman Max Baucus, a Montana Democrat, said in an interview. “It’s so important to resolve this that the president, the speaker, Senator Reid, McConnell, they’re all talking trying to find a way out of this.”
Representative Steve LaTourette, a retiring Ohio Republican, said the speaker and majority leader didn’t say during the conference call what legislation the House may take up Dec. 30 and on the following days if the Senate doesn’t act on budget legislation.
Obama’s administration is considering options on the budget and other expiring legislation such as extended unemployment benefits, Representative Steny Hoyer of Maryland, the second-ranking House Democrat, said at a news conference.
The House passed a bill in August that would extend the expiring tax cuts for all income levels, and another bill Dec. 20 to replace the automatic spending cuts with other reductions. The House hasn’t addressed some expiring provisions, including a scheduled pay cut to doctors under Medicare and expanded unemployment insurance.
Up to $250,000
The Senate voted in July to extend George W. Bush-era income tax cuts for one year for individual income up to $200,000 and income of married couples up to $250,000. Reid said House Democrats and some Republicans would join to pass such a plan.
The U.S. will reach the $16.4 trillion debt limit Dec. 31, Treasury Secretary Timothy F. Geithner said yesterday. Treasury can take so-called extraordinary measures to finance about $200 billion in deficits in 2013.
Typically, that would be enough for two months. Geithner didn’t set a specific deadline because of the lack of certainty about tax rates and spending.
The Senate bill is S. 3412. The House bills are H.R. 8 and H.R. 6684.
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