BOSTON — Citing downsides for consumers, investors and state government and those it serves, House Speaker Robert DeLeo expressed grave concern about the impact of the approaching federal fiscal cliff and said he sees the odds of it being averted at about 50-50.
During a brief interview Wednesday, DeLeo said the state’s $540 million budget shortfall could rise to nearly $900 million unless Congress and President Obama can find common ground on an alternative to major spending reductions and tax increases on the verge of hitting across the country.
“This could turn out to be a whole lot worse than it is right now,” the Winthrop Democrat said.
During a recent encounter with Congressman Edward Markey, the dean of the state’s all-Democrat U.S. House delegation, DeLeo said he asked Markey whether he believed the spending cuts and tax hikes scheduled to take effect Jan. 1 would occur or whether negotiators would find a new deficit reduction course.
“His answer was he felt that there’s no way that that could be allowed to happen and they could resolve the issue,” DeLeo said. “Having said that, I think I’ve heard the sum of those statements from Washington before and I find the position we’re in now — watching what’s going on right now, it almost seems to be just a recurring theme — discussions at the beginning, things break down.”
Does DeLeo think a divided Congress — Republicans control the House and Democrats rule the Senate — and Obama will find a safer path and steer clear of the cliff?
“I’m not sure I want to say I’m hopeful,” DeLeo said. “Well, maybe hopeful is the right word. But I’m not sure if I’m optimistic that they’re going to be able to come up with a solution. But I really hope they do because that’s again going to be money directly to the state, not to mention what that could mean for the economy of the country and in each state in particular.”