By Meghashyam Mali - 12/30/12 05:54 PM EST
Sen. Lindsey Graham (R-S.C.) on Sunday said he had been told by Defense Secretary Leon Panetta that it was unlikely the “fiscal cliff” deal being negotiated would prevent sequester cuts to the Pentagon.
“I was called by Leon Panetta last night at 7:30, during dinner. … And he said, Lindsey, I have been told that there's going to be nothing in this bill to avoid sequestration going into effect,” Graham said on “Fox News Sunday.”
Meanwhile, Senate negotiators were scrambling to craft a deal to avoid January’s combination of rising tax rates and automatic, across-the-board spending cuts.
But reports suggested that any fiscal deal would fall well short of earlier expectations, with lawmakers possibly focusing only on taxes.
Senate Majority Leader Harry Reid (D-Nev.) set a 3 p.m. deadline Sunday to reach a deal.
Graham on Sunday, though, said the odds that negotiators would hammer out a compromise by the end of the year were “exceedingly good.”
Graham said the likelihood that a tax increase on the wealthy would be part of a final agreement would be a “political victory” for President Obama, who has pushed for high-income earners to pay more in any deficit-reduction deal.
“I think, whatever we accomplish, political victory to the president, hats off to the president. He stood his ground. He's going to get tax rate increases, maybe not $250,000, but upper-income Americans,” he said. “And the sad news for the country is, that we have accomplished little in terms of not becoming Greece or getting out of debt. This deal won't affect the debt situation.
“Hats off to the president," Graham said. "He won."