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In a significant development in the fiscal cliff standoff, Republican Sen. Tom Coburn, a leading deficit hawk, said Wednesday he would support higher tax rates on wealthier Americans as part of a broader deal with President Barack Obama and congressional Democrats to avoid the crisis.

"I know we have to raise revenue," the senator from Oklahoma told MSNBC. "I don't really care which way we do it. Actually, I would rather see rates go up than do it the other way, because it gives us a greater chance to reform the tax code and broaden the base in the future."

He appears to be the first GOP senator to say publicly he would back increasing the tax rates on the wealthy, as long as that increase is coupled with spending cuts and entitlement reforms.

Sens. Susan Collins and Olympia Snowe, both Republicans from Maine, said later Wednesday they, too, would support the tax rate increase on the wealthy, though they would like to see a caveat to "protect small business owners" who include their business income on their personal tax returns.

"I believe that very wealthy individuals-millionaires and billionaires-should pay a greater percentage of their income in taxes to help us reduce the soaring deficit," Collins said, noting that "In April, I was the only Republican to vote to proceed to consideration of a bill, the so-called "Buffett Rule," which would have imposed a new minimum tax on the very wealthy."More at http://politicalticker.blogs.cnn.com/2012/12/05/gop-senator-backs-tax-
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Boehner’s once-unified coalition against income tax rate increases is showing signs of fracture. A Republican leader of the petition to consider all revenue options, Representative Mike Simpson of Idaho, said he could accept higher tax rates for married couples earning more than $500,000 a year, in exchange for an overhaul of spending in entitlement programs.

Separately, more House Republicans began to endorse Oklahoma Republican Tom Cole’s call to extend all tax cuts for middle-class earners, as Obama has asked Congress to do by the end of the year. Representative Kay Granger of Texas called it “just the right thing to do.”

Florida Representative Dennis Ross, a freshman Republican, said he wouldn’t rule out voting for Senate-passed legislation to extend only the middle-class tax cuts.

Aides to Boehner and House Majority Leader Eric Cantor of Virginia are playing down the number of Republicans willing to defect on tax rates. Publicly, the speaker has given no indication he’ll change his position.

The effort shows that Republicans’ unified position on income tax increases is splintering since the Nov. 6 election, which gave Obama a second term and increased Democratic ranks in the Senate and House.

Aides to Boehner and House Majority Leader Eric Cantor of Virginia are playing down the number of Republicans willing to defect on tax rates. Publicly, the speaker has given no indication he’ll change his position.

The effort shows that Republicans’ unified position on income tax increases is splintering since the Nov. 6 election, which gave Obama a second term and increased Democratic ranks in the Senate and House.
More at http://www.bloomberg.com/news/2012-12-05/republican-defectors-ready-to
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Both sides agree the wealthy will pay more, so now fiscal cliff talks come down to how much Republicans can wring out of the White House in return for giving in on taxes.

To President Barack Obama, it's all about first locking in additional revenue from raising taxes on high-income owners, an outcome the GOP has long rejected.

Republicans led by House Speaker John Boehner want to secure commitments on entitlement reforms and spending cuts opposed by Democrats as part of a broader agreement to reduce the nation's chronic federal deficits and debt.

A GOP source told CNN that talks between staff members on both sides resumed Thursday for the first time this week, after Obama and Boehner spoke by phone the day before.

Meanwhile, retiring Republican Rep. Steve LaTourette of Ohio told CNN that he sensed a shift in the House GOP approach during a conference meeting Wednesday.

"The sense was that there's a growing number of folks in our party that are saying, 'You know what, the president has won this round relative to the rates, but we need to you to sit down and get the second half of the deal and that's the spending,'" LaTourette said.

It remains unclear if a deal will happen before the end of the year -- less than four weeks away -- or if the negotiations will carry over into 2013 after the fiscal cliff of automatic tax hikes and spending cuts takes effect.

While economists warn that going over the fiscal cliff could lead to a recession, the administration has signaled it can delay some of the impacts to allow time to work out a deal.

All signs point toward a two-step approach sought by the newly re-elected Obama -- an initial agreement that would extend lower tax rates for income up to $250,000 for families, while letting rates return to higher levels from the Clinton era on income above that threshold.

Even conservatives such as Oklahoma Sen. Tom Coburn and Louisiana Gov. Bobby Jindal acknowledge the obvious -- taxes on the wealthy are going up despite opposition by Republicans.

"Whatever deal is reached is going to contain elements that are detrimental to our economy," Jindal wrote Thursday in an opinion piece published by Politico. "Elections have consequences, and the country is going to feel those consequences soon."

"At present, any reading of the headlines over the past week indicates that Republicans are fighting to protect the rich and cut benefits for seniors," he added. "It may be possible to have worse political positioning than that, but I'm not sure how."Much more at http://www.cnn.com/2012/12/06/politics/fiscal-cliff/index.html?hpt=hp_
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