WSJ: White House May Propose Less Ambitious Deal

With fiscal cliff talks in shambles, The White House may now be looking for a less ambitious compromise, The Wall Street Journal says.

“The White House thinking had been that either there would be a big deal, with something like $4 trillion in deficit savings over the next decade, or a trip off the fiscal cliff,’’ writes the Journal’s Gerald Seib.

“Given the fact that House Republicans couldn’t rally around a deal their own leader devised, the chances they will come together around a more ambitious deal is in doubt.

“That may mean the chances the White House will start, along with the Senate leaders noted above, to look for something more modest to just avoid the giant tax increases and spending cuts of the cliff and perhaps not much more.’’

In their latest offers, President Barack Obama had pitched $1.2 trillion in revenue and $800 billion in spending cuts, while House Speaker John Boehner put $1 trillion in revenue and $1 trillion in spending cuts on the table.

Those proposals have now gone up in smoke.

Seib concedes, “the grim reality in Washington is that nobody really knows whether or where there’s a path to avoid the fiscal cliff, in the aftermath of House Republicans’ stunning failure to pass Speaker John Boehner’s Plan B.

“Now there is no confidence he can deliver his caucus, and no obvious fallback plan in the House.’’

With Boehner sending House Republicans home for the Christmas holiday, nothing can be passed until Dec. 27 at the very earliest.