Six weeks to go on the fiscal cliff

There are only six weeks left until the end of the year, until the Bush tax rates and the Bush tax cuts of 2001 and 2003 expire. The clock is ticking. But you probably won’t see any real action this Thanksgiving week from either the Congress or the White House.

President Obama isn’t due back from his trip to Asia until Wednesday. The Senate is gone until the Monday after Thanksgiving; the House returns the Tuesday after Thanksgiving.

By then, the countdown clock will be at 34 days – less than five weeks until a deal has to be reached.

So that brings up an obvious question – what can we really expect in terms of a political solution?

If Congress isn’t able to pass something that can be signed into law by the President, the tax rates simply snap back to what they were in the Clinton Administration.

But if Congress does want to push ahead with some kind of grand bargain, that will take a big legislative effort; tax changes, spending cuts, entitlement reforms – frankly, I’m not sure there is truly enough time left to do that, especially when you consider how detailed you might have to get on those items.

Just consider what Republicans are demanding – major revisions to the tax code as part of their price for a deal that ends up bringing in more tax revenue.

The last major reform of the federal tax code was in 1986 – when you had a divided Congress ironically. The Democrats held the House, the Republicans held the Senate and Ronald Reagan was President.

That was a big time deal that took months and months of negotiation. If you would like to bone up on the issues, you can read this 1,386 page review from the Joint Committee on Taxation here.

At that time, my father was a lobbyist for Ford Motor Company – the work on that bill consumed his year, – not just the time from Thanksgiving to Christmas.

My point is simple – if you are going to open the Internal Revenue Code at this point and make changes in deductions and more, you will unleash a torrent of lobbying efforts as everyone knows this will be their one chance this year to get something into a bill that can actually pass.

That raises the chance of a Legislative Christmas Tree where little provisions get tucked into the bill at the last minute, sparking out an outcry once they are discovered.

So what’s the answer? Maybe a classic Washington deal, where you kick the can down the road, agree to goals for deficit reduction, but fill in the blanks later.

It may be more attractive to lawmakers than going over the cliff.

So, in the spirit of Congress – don’t lose any sleep this week over the fiscal cliff. Enjoy your Thanksgiving meal and your family and friends.

Because you know the Congress isn’t postponing any of their holiday events, as the clocks ticks towards the end of the year.

Tick. Tick. Tick.