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No Fiscal Deal Yet; Farm Bill Extension Would Keep Milk Prices Down

A Capitol Hill deal to avert the "fiscal cliff" is proving elusive as a deadline to avert tax hikes on virtually every American worker and block sweeping spending cuts grows perilously near.

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Reporter: The Associated Press

A Capitol Hill deal to avert the "fiscal cliff" is proving elusive as a deadline to avert tax hikes on virtually every American worker and block sweeping spending cuts grows perilously near.

Senate Majority Leader Harry Reid, D-Nev., and Senate Republican leader Mitch McConnell remain at odds on such key issues as the income threshold for higher tax rates and how to deal with inheritance taxes.

McConnell complained that Reid had yet to respond to a GOP offer made Saturday evening and reached out to Vice President Joe Biden, a longtime friend, in hopes of breaking the impasse. Biden has assumed the lead role for Democrats and a McConnell spokesman says the Kentucky Republican and the vice president are expected to negotiate by telephone into the night.

Rank-and-file lawmakers left the Capitol Sunday night with hopes that their leaders would give them something to vote on when they return Monday morning.

The top leaders in both parties on the House and Senate Agriculture committees have agreed to a one-year extension of the 2008 farm bill that expired in October, a move that would head off a possible doubling of milk prices next month.

The agreement to extend current farm law until next October was reached as negotiators hit a snag on averting a broader fiscal cliff combination of higher taxes and spending cuts January 1st.

Agriculture Secretary Tom Vilsack said Americans faced the prospect of paying $7 for a gallon if the current dairy program lapsed and the government returned to a 1948 formula for calculating milk price supports.