Why U.S. lives under the shadow of 'W'

Julian Zelizer says former President George W. Bush's key tax and homeland security policies survive in the age of Obama

STORY HIGHLIGHTS

• Julian Zelizer: For all the criticism Bush got, two key policies have survived


• He says fiscal cliff pact perpetuates nearly all of Bush's tax cuts


• Obama administration has largely followed Bush's homeland security policy, he says


• Zelizer: By squeezing revenues, Bush tax cuts will put pressure on spending

Editor's note: Julian Zelizer is a professor of history and public affairs at Princeton University. He is the author of "Jimmy Carter" and of "Governing America."

Princeton, New Jersey (CNN) -- Somewhere in Texas, former President George W. Bush is smiling.

Although some Democrats are pleased that taxes will now go up on the wealthiest Americans, the recent deal to avert the fiscal cliff entrenches, rather than dismantles, one of Bush's signature legacies -- income tax cuts. Ninety-nine percent of American households were protected from tax increases, aside from the expiration of the reduced rate for the payroll tax.

Julian Zelizer

In the final deal, Congress and President Barack Obama agreed to preserve most of the Bush tax cuts, including exemptions on the estate tax.

When Bush started his term in 2001, many of his critics dismissed him as a lightweight, the son of a former president who won office as result of his family's political fortune and a controversial decision by the Supreme Court on the 2000 election.

But what has become clear in hindsight, regardless of what one thinks of Bush and his politics, is that his administration left behind a record that has had a huge impact on American politics, a record that will not easily be dismantled by future presidents.

The twin pillars of Bush's record were counterterrorism policies and tax cuts. During his first term, it became clear that Obama would not dismantle most of the homeland security apparatus put into place by his predecessor. Despite a campaign in 2008 that focused on flaws with the nation's response to 9/11, Obama has kept most of the counterterrorism program intact.

Opinion: The real issue is runaway spending

In some cases, the administration continues to aggressively use tactics his supporters once decried, such as relying on renditions to detain terrorist suspects who are overseas, as The Washington Post reported this week. In other areas, the administration has expanded the war on terrorism, including the broader use of drone strikes to kill terrorists.

Now come taxes and spending.

With regard to the Bush tax cuts, Obama had promised to overturn a policy that he saw as regressive. Although he always said that he would protect the middle class from tax increases, Obama criticized Bush for pushing through Congress policies that bled the federal government of needed revenue and benefited the wealthy.

In 2010, Obama agreed to temporarily extend all the tax cuts. Though many Democrats were furious, Obama concluded that he had little political chance to overturn them and he seemed to agree with Republicans that reversing them would hurt an economy limping along after a terrible recession.

Opinion: Time to toot horn for George H.W. Bush

With the fiscal cliff deal, Obama could certainly claim more victories than in 2010. Taxes for the wealthiest Americans will go up. Congress also agreed to extend unemployment compensation and continue higher payments to Medicare providers.

But beneath all the sound and fury is the fact that the 2001 and 2003 tax cuts, for most Americans, are now a permanent part of the legislative landscape. (In addition, middle class Americans will breathe a sigh of relief that Congress has permanently fixed the Alternative Minimum Tax, which would have hit many of them with a provision once designed to make sure that the wealthy paid their fair share.)

As Michigan Republican Rep. Dave Camp remarked, "After more than a decade of criticizing these tax cuts, Democrats are finally joining Republicans in making them permanent." Indeed, the Congressional Budget Office estimates that the new legislation will increase the deficit by $4 trillion over the next 10 years.

The tax cuts have significant consequences on all of American policy.

Opinion: Christie drops bomb on GOP leaders

Most important, the fact that a Democratic president has now legitimated the moves of a Republican administration gives a bipartisan imprimatur to the legitimacy of the current tax rates.

Although some Republicans signed on to raising taxes for the first time in two decades, the fact is that Democrats have agreed to tax rates which, compared to much of the 20th century, are extraordinarily low. Public perception of a new status quo makes it harder for presidents to ever raise taxes on most Americans to satisfy the revenue needs for the federal government.

At the same time, the continuation of reduced taxes keeps the federal government in a fiscal straitjacket. As a result, politicians are left to focus on finding the money to pay for existing programs or making cuts wherever possible.

New innovations in federal policy that require substantial revenue are just about impossible. To be sure, there have been significant exceptions, such as the Affordable Care Act. But overall, bold policy departures that require significant amounts of general revenue are harder to come by than in the 1930s or 1960s.

Republicans thus succeed with what some have called the "starve the beast" strategy of cutting government by taking away its resources. Since the long-term deficit only becomes worse, Republicans will continue to have ample opportunity to pressure Democrats into accepting spending cuts and keep them on the defense with regards to new government programs.

Politics: Are the days of Congress 'going big' over?

With his income tax cuts enshrined, Bush can rest comfortably that much of the policy world he designed will remain intact and continue to define American politics. Obama has struggled to work within the world that Bush created, and with this legislation, even with his victories, he has demonstrated that the possibilities for change have been much more limited than he imagined when he ran in 2008 or even in 2012.

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The opinions expressed in this commentary are solely those of Julian Zelizer.

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600 Indian guitarists play tribute to gang-rape victim

NEW DELHI: A group of 600 guitarists have paid a musical tribute to an Indian gang-rape victim, playing "Imagine" by John Lennon in a bid to spread "hope, peace and promise" in a country still coming to terms with the violence.

The group assembled at a music festival in the eastern Indian hilltown of Darjeeling on Thursday, nearly three weeks after the brutal rape and murder of a student on a moving bus in New Delhi brought an outpouring of national anger.

"We chose this song because it talks about hope, peace and promise," Sonam Bhutia, tourism secretary of Darjeeling and one of the festival organisers, told AFP by telephone.

"The song is so inspiring. It talks about a universe without any boundaries," Bhutia said of the 1971 Lennon track.

"The tribute was a gesture on our part to show that we are with the victim's family in their hour of unimaginable sorrow."

The scenic town of Darjeeling, in a part of India wedged between Nepal and Bhutan, is famous for its tea.

The savage attack on the woman has triggered countrywide protests with calls for better safety and an overhaul of laws governing crimes against women.

-AFP/fl

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U.S. troops in Turkey to ward off Syria

STORY HIGHLIGHTS

• The missiles and troops will be under the overall control of NATO


• Syrian rebels are determined to take out a helicopter base


• Parents of a kidnapped U.S. journalist in Syria plead for his release


• An explosion at a gas station in Damascus kills 10 people

(CNN) -- U.S. troops arrived in Turkey on Friday to man Patriot missile defense batteries near the Syrian border, according to Turkish state media.

Syria has previously launched Scud missiles at cities near the Turkish border in a desperate bid to extend its firepower.

In response, the U.S., Germany and the Netherlands deployed Patriot air defense missiles to the border region to intercept any Syrian ballistic missiles.

The missiles and troops will be under the overall control of NATO, but the missiles will be operated by U.S. forces

A group of 27 U.S. troops landed in Gaziantep, Turkey, where they will survey the Patriot deployment, according to Turkish state news agency, Anadolu.

U.S. officials did not release any information about the troops arrival, but had said last month that forces will be deployed to Turkey.

"We've made very clear to them that were going to protect countries in this region," Defense Secretary Leon Panetta said last month. "We have to act to do what we have to do to make sure that we defend ourselves and make sure that Turkey can defend itself."

The fight for the helicopter airport

Taftenaz airbase in northern Syria has been a deadly thorn in the side of rebels for months, which they have not yet been able to remove.

Free Syrian Army fighters for the third day tried to wrest control of the helicopter airbase from government forces.

If successful, it would shut down President Bashar al-Assad's military helicopter pads and diminish his airstrikes in the region.

Both opposition and government sources reported that the extremist Nusra Front, which the U.S. has designated as a terrorist group, is taking part in the assault on the airport.

Al-Assad has exacted retribution on the nearby city of Binnish, where amateur video shows dozens of smoke plumes marking the spots where deadly ordnance has struck.

On Thursday, rebels published videos of themselves firing on the air base with heavy truck-mounted machine guns and a captured tank, destroying one government tank and appearing to shoot down a helicopter.

CNN cannot confirm the authenticity of videos from the Syrian conflict posted online.

Gas station attack in Damascus

An explosion at a gas station in Damascus near a hospital killed 10 people Friday, Syrian TV reported.

An opposition organization expects the toll to rise as many of the injured are in critical condition after fire spread to nearby cars and buildings.

The explosion came from a car bomb, the Syrian Observatory for Human Rights posted on its Facebook page.

Appeal for missing U.S. journalist

In New Hampshire, the parents of American journalist James Foley appealed Thursday to his kidnappers to release him and inform them of his whereabouts and condition of his health.

Foley's father visibly choked up while reading a statement directed at the abductors. "We'd like them to contact us," he said. "I ask the captors for their compassion and Jame's quick release."

Foley was abducted in November in Syria, where he has worked for a year. He has been detained before while working in Libya, but was later released by the government.

The rapidly mounting death toll

The overall death toll in devastated Syria has surpassed an estimated 60,000 people, the United Nations said Wednesday.

To put it in perspective: 60,000 people is roughly the population of Terre Haute, Indiana; or Cheyenne, Wyoming. It's how many people would fit in Dodger Stadium, and it's more than the 50,000-plus U.S. combat deaths in Vietnam.

The figure is about 15,000 higher than the death toll CNN had cited from a collection of sources.

On Thursday, al-Assad's forces repeatedly bombed the Damascus suburb of Douma with airstrikes. Residents could be seen combing through rubble, pulling out the bodies of those killed on videos posted on the Internet.

CNN's Amir Ahmed and Joe Sterling contributed to this report

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Venezuela's Chavez fighting severe lung infection

Venezuelan President Hugo Chavez speaks during Brazilian Foreign Minister's official visit at Miraflores Presidential Palace in Caracas, on Nov.1, 2012. / LEO RAMIREZ/AFP/Getty Images

Updated 10:35 PM ET

CARACAS, Venezuela Venezuela's government says President Hugo Chavez is being treated for "respiratory deficiency" after complications from a severe lung infection.

Information Minister Ernesto Villegas provided the update on Chavez's condition Thursday night. He read from a statement saying that Chavez's lung infection had led to "respiratory deficiency" and required strict compliance with his medical treatment.

The government expressed confidence in Chavez's medical team and condemned what it called a "psychological war" in international media surrounding the president's condition.

Chavez hasn't been seen or heard from since his Dec. 11 operation in Cuba. Venezuela's opposition has demanded more specific information from the government about his health.

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Ex-USC Player: Painkiller Injections Caused Heart Attack

Despite stated label risks of possible fatal heart attack, stroke or organ failure, college football players across the country are still being given injections of a powerful painkiller on game days so they can play while injured, an ABC News investigation has found.

The drug, a generic version of Toradol, is recommended for the short-term treatment of post-operative pain in hospitals but has increasingly been used in college and professional sports, and its use is not monitored by the NCAA, the governing body of college sports.

Only two of the country's top football programs, Oklahoma and the University of Nebraska, reported to ABC News that they have limited or stopped the use of the drug in the wake of growing concern about its risks.

Which Top-Ranked College Football Teams Use Toradol?

Oklahoma said it stopped using the painkillers in 2012 after using them repeatedly in 2010 and 2011.

Nebraska said its doctors now restrict its use.

SEND TIPS About Painkiller Use in College Sports to Our Tipline

"While team physicians reserve the option to use injectable Toradol, it is rarely prescribed, and its use has been avoided this season following reports of heightened concern of potential adverse effects," Nebraska said in a statement to ABC News.

Stephen Dunn/Getty Images

Despite Risks, College Football Still Uses Powerful Painkiller Watch Video

The top two college football programs, Notre Dame and Alabama, refused to answer questions from ABC News about the painkiller. They play for the national college championship on Jan. 7.

Controversy surrounding the drug has grown this year following claims by former USC lineman Armond Armstead that he suffered a heart attack after the 2010 season, at age 20, following shots of generic Toradol administered over the course of the season by the team doctor and USC personnel.

"I thought, you know, can't be me, you know? This doesn't happen to kids like me," Armstead told ABC News.

The manufacturers' warning label for generic Toradol (ketorolac tromethamine) says the drug is not intended for prolonged periods or for chronic pain and cites gastrointestinal bleeding and kidney failure as possible side effects of the drug.

In addition, like other drugs in its class, the generic Toradol label warns "may cause an increased risk of serious cardiovascular thrombotic events, myocardial infarction (heart attack), and stroke, which can be fatal."

"This risk may increase with duration of use," the so-called black box warning reads.

In a lawsuit against the school and the doctor, Dr. James Tibone, Armstead claims the school ignored the stated risks of the drug and never told him about them.

"He was a race horse, a prize race horse that needed to be on that field no matter what," said Armstead's mother Christa. "Whether that was a risk to him or not."

Armstead says he and many other USC players would receive injections of what was known only as "the shot" in a specific training room before big games and again at half-time.

"No discussion, just go in. He would give the shot and I would be on my way," Armstead told ABC News.

Armstead said the shot made him feel "super human" despite severe ankle, and later shoulder pain, and that without it, he never could have played in big USC games against Notre Dame and UCLA.

"You can't feel any pain, you just feel amazing," the former star player said.

USC declined to comment on Armstead's claims, or the use of Toradol to treat Trojan players.

An ABC News crew and reporter were ordered off the practice field when they tried to question USC coach Lane Kiffin about the use of the painkiller. USC says the ABC News crew was told to leave because they had not submitted the appropriate paperwork in advance to attend the practice session.

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Look beyond the fiscal cliff

STORY HIGHLIGHTS

• Dean Baker: Budget deficit is not the only top issue in our national economic policy


• Baker: Fiscal cliff debate has been a distraction of the bigger problem of a downturn


• He says fears of big deficits are preventing us from boosting the economy more


• Baker: Given the economy's weakness, the government has to run big deficits

Editor's note: Dean Baker, an economist, is co-director of the Center for Economic and Policy Research, a progressive economic policy organization. He is author of "The End of Loser Liberalism: Making Markets Progressive."

(CNN) -- We have just passed into the new year, and the distractions created by the debate over the fiscal cliff appear to be behind us. Maybe.

That debate has been part of a larger distraction -- the concern over budget deficits at a time when by far the country's most important problem remains the economic downturn caused by the collapse of the housing bubble. The obsession with budget deficits is especially absurd because the enormous deficits of recent years are entirely the result of the economic downturn.

In spite of this, the leadership of both parties has elevated the budget deficit to be the top and virtually only issue in national economic policy. This means ignoring the downturn that continues to cause enormous amount of unnecessary suffering for tens of millions of people.

Dean Baker

But fears of big deficits are preventing us from giving the same sort of boost to the economy that got us out of the Great Depression. The explanation is simple: profits have returned to prerecession levels.

Opinion: Cliff deal hollow victory for American people

This means that from the standpoint of the people who own and run American businesses, everything is pretty much fine. Moreover, they see the deficits created by the downturn as providing an opportunity to go after Social Security and Medicare.

The Campaign to Fix the Debt, a nonpartisan organization involving many of the country's richest and most powerful CEOs, sets out to do just that. It has become standard practice in Washington for Wall Street types and other wealthy interests to finance groups to push their agenda.

The Campaign to Fix the Debt involves the CEOs themselves directly stepping up to the plate and pushing the case for cutting Social Security and Medicare as well as lowering the corporate income tax rate.

It's clear what's going on here. We don't need any conspiracy theories.

iReport: What's your message for Washington?

CEOs from both political parties have openly come together to demand cuts in Social Security and Medicare, two programs that enjoy massive political support across the political spectrum. The wealthy are joining hands without regard to political affiliation to cut benefits that enjoy broad bipartisan support among everyone who is not rich.

President Barack Obama has an opportunity to show real leadership. He should explain to the public the basic facts that all budget experts know: We do not have a chronic deficit problem. The big deficits are the result of collapsed economy. The priority of the president and Congress must be to put people back to work and bring the economy back up to speed.

Fiscal cliff deal: 5 things to know

When the housing bubble burst, annual spending on residential construction fell back by more than 4% of GDP, which is $600 billion in today's economy. Similarly, consumption plunged as people drastically curtailed their spending in response to the loss of $8 trillion in housing bubble generated equity.

There is no easy way for the private sector to replace this demand. Businesses don't invest unless they see demand for their products, regardless of how much love we might shower on the "job creators." In fact, if anything, investment is surprisingly strong give the large amount of excess capacity in the economy. Measured as a share of GDP, investment in equipment and software is almost back to its prerecession level. It is hard to envision investment getting much higher, absent a major boost in demand from some other sector.

This is why it is necessary for the government to run large deficits. Ideally, the money would be spent in areas that will make us richer in the future: Education, infrastructure, research and development in clean energy, etc. There is just no way around a large role for the government given the economy's current weakness.

Big issues still pending

Obama needs to explain this simple story to the country. The rich of both parties will hate him for going down this route. They will use their powers to denounce him. But the American people support Social Security and Medicare, and they support an economy that creates jobs for ordinary workers.

Obama needs the courage to tell the truth.

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The opinions expressed in this commentary are solely those of Dean Baker.

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Starbucks to open first store in Vietnam

HANOI: Starbucks said on Thursday it would open its first store next month in Vietnam, seeking a foothold in the coffee-loving country as part of efforts to expand in Asia.

The country's first Starbucks cafe will be in southern Ho Chi Minh City, the US beverage giant said in a joint statement with its local partner, Hong Kong's Maxim Group.

"Vietnam is one of the most dynamic and exciting markets in the world and we are proud to add Vietnam as the 12th market across the China and Asia-Pacific region," said Starbucks China and Asia Pacific president John Culver.

Starbucks has been targeting growth outside of the stagnant US market, opening thousands of stores in China and across the Asia-Pacific region over the past few years.

In October, it opened its first stores in India, in partnership with domestic giant Tata Global Beverages.

Unlike tea-drinking India, Vietnam - the world's second-largest coffee producer - already has a strong local coffee culture with dozens of popular local chains and small coffee-shops on nearly every street corner.

"Starbucks is deeply respectful of Vietnam's long and distinctive local coffee culture," Culver said in the statement.

"We know coffee is a national pride for many Vietnamese and as such, we look forward to contributing and growing Vietnam's already vibrant coffee industry," he added.

Starbucks already purchases "notable" amounts of high-quality arabica coffee from Vietnam and is committed to buying more over the long-term, according to the statement.

Culver said in December that Starbucks will have almost 4,000 stores in the Asia-Pacific region by the end of 2013, including 1,000 in China.

- AFP/de

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Fiscal cliff averted, but fights loom

STORY HIGHLIGHTS

• Boehner undid "everything he promised he would do" in 2010, GOP lawmaker says


• Obama calls for "a little less brinksmanship" next time


• Tuesday night's vote prevents tax increases for more than 98% of Americans


• It also staves off $110 billion in automatic cuts to domestic and military spending

(CNN) -- President Barack Obama has signed into law a bill to avert the fiscal cliff, a day after the House and Senate approved the much-debated legislation.

Obama, who returned to his family vacation in Hawaii after Tuesday's House vote, signed the bill via autopen on Wednesday.

But new battles over taxes and spending await Washington in the next few weeks.

Congress averted that self-built precipice late Tuesday when the House voted to stave off widespread tax increases and deep spending cuts by accepting a brokered Senate compromise. It makes permanent the Bush administration's tax cuts for individuals earning less than $400,000 per year and couples earning less than $450,000.

It raises rates on those who make more than that from 35% to 39.6%, bringing back a top tax bracket from the Clinton administration, and will raise roughly $600 billion in new revenues over 10 years, according to various estimates.

The bill also extends unemployment insurance and delays for two months the threat of sequestration -- a series of automatic, across-the-board cuts in federal spending.

Economists had predicted the combination of those tax increases and spending cuts could have thrown the U.S. economy back into recession and driven unemployment back into the 9% range.

Meanwhile, a new Congress takes office on Thursday, and lawmakers will soon be confronted by the need to raise the federal debt ceiling and what to do about the still-hanging sequester -- a legacy of the last battle over the debt ceiling, in 2011.

Read more: Five things about the fiscal cliff

"The sum total of all the budget agreements we've reached so far proves that there is a path forward that is possible, if we focus not on our politics but on what's right for the country," Obama told reporters late Tuesday, after the House approved the fiscal cliff deal. "And the one thing that I think, hopefully, in the new year, we'll focus on is seeing if we can put a package like this together with a little bit less drama, a little less brinksmanship, not scare the heck out of folks quite as much."

The Bush tax cuts expired at midnight Monday, while sequestration had been scheduled to start when federal offices reopened Wednesday.

World markets rose after the late-night vote. U.S. stocks jumped, too, with the Dow Jones Industrial Average rising nearly 2% by mid-afternoon.

Rum, electric vehicles and motor sports: Nuggets in bill

Tuesday night's 257-167 vote saw Boehner, R-Ohio, and about a third of the GOP majority lining up with Democrats against most of their own caucus, including Majority Leader Eric Cantor and party whip Kevin McCarthy. Rep. Nan Hayworth, an outgoing Republican representative from New York, said she was a "reluctant yes."

"This is the best we can do, given the Senate and the White House sentiment at this point in time, and it is at least a partial victory for the American people," Hayworth said. "I'll take that at this point."

The Senate plan was brokered by Vice President Joe Biden and Senate Minority Leader Mitch McConnell, R-Kentucky, and it passed that Democratic-led chamber 89-8. But many House Republicans complained the bill did too little to cut spending while raising taxes for them to support it.

Boehner's White House F-bomb

Conservative lobbyist Grover Norquist, whose Americans for Tax Reform pushes candidates to sign a pledge never to raise taxes, said the plan preserves most of the Bush tax cuts and won't violate his group's beliefs.

"The Bush tax cuts lapsed at midnight last night," Norquist tweeted Tuesday. "Every (Republican) voting for Senate bill is cutting taxes and keeping his/her pledge."

But Rep. Jeff Landry, R-Louisiana, told CNN's "Early Start" that Obama convinced Boehner "to undo everything he promised he would do" after the 2010 elections that gave the GOP control of the House.

"They did a debt ceiling deal, gave the president $2.1 trillion," Landry said. "They turned that deal off for two months. That's going to be another fight on top of the sequestration, a debt ceiling fight."

iReport: What's your message for Washington?

Other Republicans warned that as they did in 2011, they'll be demanding additional cuts before they agree to raise the federal cap on borrowing.

"The president has maxed out his credit card, and he is not going to get an unlimited credit card," Sen. John Barrasso, R-Wyoming, told CNN. "We're going to talk specifically about cuts and specifically focused on tax reform as well as helping to save and strengthen Medicare and Social Security. And that's the next discussion we're going to have in Washington."

The federal government bumped up against its $16.4 trillion debt ceiling on Monday and has about two months before it runs out of ways to shuffle money around to keep Washington within its legal borrowing limit. Obama had sought to resolve the issue as part of the fiscal cliff negotiations, but the issue never made it to a final bill.

Tuesday night, the president warned Congress that he will not tolerate another round of brinksmanship that could have "catastrophic" effects on the global economy.

"While I will negotiate over many things, I will not have another debate with this Congress over whether or not they should pay the bills that they've already racked up through the laws that they've passed," he said.

How they voted: House | Senate

The last debt-ceiling battle led to the sequester, a kind of fiscal doomsday device that Congress was supposed to disarm by agreeing to more than $1 trillion in other cuts over the next decade. They didn't, leaving federal agencies preparing to slash spending by $110 billion by the end of the 2013 budget year.

Before Tuesday night, the Defense Department had been preparing to issue furlough notices for its entire civilian work force of 800,000. Those notices were stayed on Wednesday -- but Pentagon officials say they're worried that unpaid leave may be harder to implement later in the fiscal year.

"We hope Congress can find a way to end sequester once and for all," Pentagon spokesman George Little said.

While the deal gives Obama bragging rights for raising income taxes on the wealthiest Americans -- the first rate increase for any Americans since 1993 -- it also leaves him breaking a promise.

Obama had vowed to raise tax rates for the top-earning 2% of Americans, including those with household income above $250,000 and individuals earning more than $200,000.

Raising the threshold for higher tax rates shrinks the number of Americans affected. While nearly 2% of filers have adjusted gross incomes over $250,000, only 0.6% have incomes above $500,000, according to the Tax Policy Center.

By comparison, Census Bureau figures put the median U.S. household income at just over $50,000.

And despite the last-minute fiscal cliff agreements, Americans are still likely to see their paychecks shrink somewhat because of a separate battle over payroll taxes.

The government temporarily lowered the payroll tax rate in 2011 from 6.2% to 4.2% to put more money in the pockets of Americans. That adjustment, which has cost about $120 billion each year, expired Monday.

Now, Americans earning $30,000 a year will take home $50 less per month. Those earning $113,700 will lose $189.50 a month.

Opinion: Cliff deal hollow victory for American people

The legislation also caps itemized deductions for individuals making $250,000 and for married couples making $300,000. Taxes on inherited estates over $5 million will go up to 40% from 35%, and that threshold will be indexed for inflation.

The alternative minimum tax, a perennial issue, will be permanently adjusted for inflation. Child care, tuition and research and development tax credits will be renewed. The "Doc Fix" -- reimbursements for doctors who take Medicare patients -- will continue, but it won't be paid for out of the Obama administration's signature health care law.

CNN's Dana Bash, Rich Barbieri, Charles Riley, Dana Ford, Holly Yan, Josh Levs, Jessica Yellin, Deirdre Walsh and Ted Barrett contributed to this report.

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Hillary Clinton discharged from hospital

WASHINGTONSecretary of State Hillary Clinton was discharged from a New York hospital Wednesday, after spending 72 hours under observation following the discovery of a blood clot in her head, the State Department said.

In a statement, spokesperson Philippe Reines said: "Her medical team advised her that she is making good progress on all fronts, and they are confident she will make a full recovery. She's eager to get back to the office."

Clinton and her family thanked her medical team "for the excellent care she received," Reines said.

Earlier Wednesday, Clinton had been seen in public for the first time in three weeks when she walked out of the Harkness Eye Institute in New York City and into a secure van along with a smiling Bill and Chelsea Clinton and accompanied by a security detail, reports CBS News correspondent Margaret Brennan.

The State Department had said Secretary Clinton was active in speaking with staff and reviewing paperwork while she continued to recover at New York Presbyterian Hospital.

Clinton was admitted to a New York hospital Sunday and was treated with blood thinners to dissolve a clot in the vein behind the right ear. Doctors found the clot during a follow-up exam stemming from a concussion she suffered in early December. She has been hospitalized for around 72 hours, which is a window of time during which it is possible to establish the proper blood thinner dosage that would be required prior to discharge according to doctors.

Clinton's doctors say there was no neurological damage.

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Obama Signs 'Fiscal Cliff' Bill With Autopen

Jan 3, 2013 12:53am

Charles Dharapak/AP Photo

HONOLULU, Hawaii — President Obama has signed the “fiscal cliff” legislation into law via autopen from Hawaii, where he is vacationing with his family.

The bill to avert the “fiscal cliff” arrived at the White House late this afternoon and it was immediately processed, according to a senior White House official. A copy was delivered to the president in Hawaii for review. He then directed the bill to be signed by autopen back in Washington, D.C.

The Bush administration deemed in 2005 that the use of the autopen is constitutional, although President George W. Bush never used the mechanical device to replicate his signature on a bill.

The office of legal counsel found at the time that Article 1, Section 7 of the Constitution allows the president to use the autopen to sign legislation, stating “the President need not personally perform the physical act of affixing his signature to a bill to sign it.”

Obama has used the autopen twice in the past to sign legislation, both times while he was overseas.

Use of the autopen has been controversial.  Conservative groups alleged last summer that Obama used an autopen to sign condolence letters to the families of Navy SEALs killed in a Chinook crash in Afghanistan — a charge the White House disputed flatly as false.

In 2004, then-Secretary of Defense Donald Rumsfeld was criticized for using an autopen to sign condolence letters to the families of fallen troops.

And in 1992 then-Vice President Dan Quayle even got into some hot water over his use of the autopen on official correspondence during an appearance on “This Week with David Brinkley.”

Obama, who arrived back in Hawaii early Wednesday morning to continue his family vacation, spent the afternoon golfing with friends at the Marine Corps base at Kaneohe Bay.

Obama is slated to remain in Hawaii through Saturday.

ABC News’ Jonathan Karl contributed to this report

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