‘Cliff’ talks on rocky footing
stimulus spending, aid to help homeowners refinance mortgages, $30 billion in extended unemployment benefits and a new process to make it easier to raise the federal debt limit, which must increase in a matter of months to prevent a default.
“I’m disappointed in where we are,” Boehner said.
Four weeks remain before the nation heads off the $500 billion “fiscal cliff” of tax hikes and spending cuts, which experts warn could cause a recession. Tax rates in place for a decade are set to go up after Dec. 31; days later, massive spending cuts will begin to slice the federal government.
Neither political party has budged from their starting positions. Top Republicans also have refused Obama’s call to pass a bill that would prevent a tax hike on98 percent of households while talks continue.
As Obama prepares to take his proposal on the road Friday, Democrats are increasingly buoyed, believing they hold a stronger hand. “Look, we don’t expect the Republicans to be enthusiastic and start cheerleading about a deal that includes higher rates on the wealthiest Americans,” said Sen. Charles Schumer, D-N.Y. “But they see the handwriting on the wall.”
With Republicans wary of being blamed for a New Year’s tax hike of $2,200 on average Americans, if no deal is struck, Obama has tapped his vast campaign infrastructure to pressure the GOP.
On a shopping trip to the grand opening of Washington’s first Costco, Vice President Joe Biden suggested the tax breaks for average Americans are needed to maintain con- sumer confidence. “Consumer confidence is growing, the last thing we need to do is dash that,” Biden said in between sampling snacks and shopping for gifts.
Obama and Boehner spoke late Wednesday before high-level talks resumed for the first time since top congressional leaders met at the White House immediately after the election.
“It was frank and direct and a good conversation,” said White House spokesman Jay Carney. The call lasted 28 minutes, one White House official said.
Boehner characterized the president as “direct and straightforward.”
Republicans are increasingly frustrated that Democrats have declined to outline specific cuts to Medicare, Medicaid and other government programs in exchange for Boehner’s willingness to consider new revenue sources.
Boehner laid the blame for the stalemate on Obama and his allies on Capitol Hill. “Listen, this is not a game. Jobs are on the line. The American economy is on the line,” Boehner said. “The White House has to get serious.”
As Republicans criticize the president for campaigning rather than negotiating, they are also trying their hand at rousing support for keeping tax breaks for all, including the wealthy.
“ReTweet if you believe we cannot solve this #FiscalCliff by taxing the American people,” wrote Rep. Kevin McCarthy of California, the Republican whip, on Twitter.
Both sides had agreed to a framework that would provide a down payment of new revenues and spending cuts this year, while establishing targets for broader tax-and-spending reforms to be worked out next year. But staff talks have made little progress.
Democrats said their offer is on the table — a down payment of $900 billion in new revenue over a decade by allowing upper-end tax rates to expire, as Obama has proposed, on income over $250,000 for couples or $200,000 for individuals. The top tax rate would go up to 39.6 percent. For upper-income earners, dividends would be taxed at the regular rates and capital gains at 20 percent; both are now taxed at 15 percent.
“Republicans know where we stand,” said Senate Majority Leader Harry Reid, D-Nev., expressing confusion at Boehner’s complaint that Democrats had not made an offer. “I don’t understand his brain.”