How Obama could have gotten a better fiscal cliff deal without Biden

According to the Senate aide, Reid believed that one of two things would happen if the negotiations were allowed to play out his way: Either McConnell, who obviously wanted a deal, would have come slinking back to him and basically accepted Reid’s last offer. “It would have been great if he called Biden and no one called him back,” says the leadership aide. “He would be so desperate for a deal that he took whatever he could get.” Or, less likely, McConnell would have thrown in the towel, allowing Reid to hold a vote on the Democratic fallback bill, which would have moved the income threshold back to $250,000 while extending unemployment insurance and a series of tax credits for the poor and middle class.

The latter might well have passed the Senate—Reid believed there were close to 60 votes for it—but would have been unlikely to pass the House, sending us over the cliff. In that case, Reid assumed the House GOP would have taken the blame, and that Republicans would rapidly soften up. Reid’s plan was to then work out another deal with McConnell that would have provided a small fig leaf—perhaps a slight rise in the income threshold above $250,000, but not close to $400,000 or $450,000—which would have likely passed on Saturday, January 5 (basically the soonest possible date). The aim was to pass this new bill with a large bipartisan majority (just as the eventual compromise did), thereby isolating the House GOP and forcing them to pass it too.