Taking it to the wire, and beyond

An incredible New Year's Eve in Washington - but not for the right reasons

Even by Congress' high standards of messy brinkmanship, this was an extraordinary night.

As the rest of America celebrated New Year's Eve, Democrat senators were shut in a meeting with Vice-President Joe Biden. He was explaining a deal he had done with the Republican leadership in the Senate - it puts taxes up for those families earning over $450,000 (£277,000; 340,000 euros) a year and puts off planned spending cuts for two months.

American politicians certainly know how to take it to the wire. And just a little bit beyond. The plan was to vote on it before the midnight deadline. They didn't make it.

Officially, the US has tumbled over the fiscal cliff. But we don't yet know what the impact will be. It is possible, even likely, that it will float gracefully upwards again, wafted on the winds of Congressional approval.

Then again, disgruntled Republicans in the House could send it crashing to the ground, with a sickening thump.

There is a lot for them to dislike in this deal, and they will have a point when they say it does little to cut spending. But to stand on their principle would also be to oppose tax cuts for most Americans. They might decide it would be foolish to play chicken with their reputations.

They can, however, afford to grandstand a little longer. It is an easy thing to do on New Year's Day, when the markets are closed and the federal government is shut, so there is no-one to panic, and no-one to impose any savage cuts.

But play it very much longer and real damage begins to be done to the economy. This has not yet played out. There are unhappy Democrats, as well. But their party had its act together and their president had a plan. The Republicans look passionate but rudderless, mistaking ardour for strategy.

This inglorious episode is not yet over but it will reinforce the average American's contempt for Congress.

The president will do all he can to make sure that the Republicans are branded as the authors of that body's intransigence, and duly get the blame.