WASHINGTON - Sen. Joe Manchin offered legislation Sunday to alleviate the worst immediate effects of the so-called "fiscal cliff," while also providing a path forward to a long-term solution.
Manchin, D-W.Va., introduced the "Cliff Alleviation at the Last Minute," or CALM Act, with less than 36 hours to go before the massive tax hikes and deep spending cuts from the cliff start to take effect.
"If we're determined to go over the cliff, we've got to do something to soften the landing, because at the bottom of the fiscal cliff are immediate and massive tax increases, deep and indiscriminate spending cuts, and the risk of another recession," Manchin said in a floor speech to introduce the legislation. "So as we come down to the final hours, we have two choices: To do nothing and cause an unbelievable amount of hardship for our fellow Americans or to do something to reduce the suffering inflicted on our citizens by an inflexible political system. I choose to do something.
"This bill, the CALM ACT, is not something that I am excited about or proud to offer. This is not a great plan, merely a better plan than going over the cliff. It should never have come to this."
Manchin's bill proposes phasing in the tax hikes over the next three years, instead of allowing all of them to hit immediately. The bill also would allow the Office of Management and Budget to prioritize which programs will be cut, rather than apply an across-the-board cut. The measure also would encourage Congress and President Obama to reach the "big fix" that economists have called for to put the nation's fiscal house back in order.
Manchin said the CALM Act would do three things: "One, it will soften the financial blow of the fiscal cliff. Two, it will calm our financial markets. Three, it gives us the certainty of a plan now, but allows us, if we ever find the courage, to pursue the fiscal grand bargain that has eluded us so far.
"Make no mistake, the financial markets are watching us and they're getting more nervous by the hour. We need to reassure them that we're capable of making big financial decisions."
He continued: "Just look at what happens to people in need if we go over the cliff and just do nothing.
On New Year's Day, the lowest income tax rate will jump from 10 percent back to the Clinton era rate of 15 percent. That's a pretty big financial bite for people who are struggling right now. Instead of overnight tax hikes of 5 percent, the CALM Act smooths the transition by phasing in increases over three years. So instead of a 5 percent increase, they'll only have to bear a 1.6 percent increase in the first year. The CALM Act does the same with the other tax rates, phasing them in over three years under the same proportions."
He also said "something has gone terribly wrong when the biggest threat to the American economy is the American Congress."
"This is one of those moments that the Senate was intended to live up to to provide leadership, to find common ground, to level with the American people, and to be honest with each other. With our debt continuing to soar and too many Americans still looking for jobs, these are times that demand the very best of the Senate.
"Everywhere in West Virginia and, in fact, all over the country families are making tough choices about how to make ends meet. It's time for Washington to do the same. Here in the Senate, it seems to me that we're always fighting about something. That might not change any time soon. But more often than not, I believe we can rise to the common ground of great national purpose. And I believe with all my heart that this is one of those times."