The White House and Senate leaders reached a bipartisan compromise on the fiscal cliff that would allow tax rates to rise on income over $450,000 and delay steep automatic federal spending cuts for two months.
The final deal was hammered out between Senate Minority Leader Mitch McConnell (R-Ky.) and Vice President Joe Biden, after nearly two months of talks between other leaders failed. President Barack Obama called Senate Majority Leader Harry Reid (D-Nev.) and House Minority Leader Nancy Pelosi (D-Calif.) Monday night, and a Democratic source said both leaders signed off on the package.
But there were indications that might have slightly overstated the case: A Senate Democratic aide said Reid simply offered to give Biden a chance to sell Senate Democrats on the accord, as he did at a 9:15 p.m. meeting at the Capitol. And Pelosi, in a statement shortly after 10 p.m., did not endorse or criticize the pact: She said she was waiting for the Senate to act and then would present it to House Democrats.
The final sticking point was over delaying the so-called sequester, across-the-board spending cuts slated to begin Jan. 2. Those cuts will be replaced in equal parts by fresh government revenues and other targeted spending reductions.