Fiscal Cliff's Edge Drawing Close in U.S.
New Year's Eve dawned with no solution to Washington's budget impasse, setting up a 24-hour scramble to determine whether lawmakers could do what they've promised for months: engineer an alternative to the so-called fiscal cliff.</br></br>What happens Monday could go some way to determining the short-term fate of the U.S. economy and the reputation of the government, both of which have been dinged by the spectacle of endless seemingly circular negotiations.</br></br>Carrying the baton late into Sunday evening were Senate Minority Leader Mitch McConnell (R., Ky.) and Vice President Joe Biden. A spokesman for Mr. McConnell said Monday morning that the two men "will continue to work toward a solution." In the past two weeks, at least three different sets of negotiation teams have sought a way out.</br></br>On taxes, one of the thorniest issues on the table, the two sides appeared to be converging. U.S. President Barack Obama has called for raising individual income-tax rates on family income above $250,000. In the latest round of Senate talks, Republicans proposed a $550,000 threshold, which Democrats moved to $450,000, according to Sen. Dick Durbin (D., Ill.).</br></br>On the estate tax, Democrats are no longer insisting on an increased rate and instead have agreed to put the matter to a separate vote, which suggests current rates will likely continue. That's a concession to the GOP and a number of farm-state Democrats in the Senate. Absent action, rates on estates will jump and the threshold at which they would hit is set to fall.