WASHINGTON — House Speaker John Boehner said Friday there has been no progress in negotiations to avert a “fiscal cliff” combination of automatic tax increases and spending cuts in January and called on President Barack Obama to produce a new offer.
Four days after House Republicans offered a plan to raise tax revenues and cut spending, Boehner told reporters that the White House has failed to outline its proposal and instead has pushed the nation closer to a fiscal cliff that economists warn could plunge the country into another recession. The two men also spoke privately by phone on Wednesday. Boehner described the conversation as pleasant, “but just more of the same.”
“Since then, there’s been no counteroffer from the White House,” Boehner complained. “Instead, reports indicate that the president has adopted a deliberate strategy to slow-walk our economy right to the edge of the fiscal cliff.”
Boehner singled out for criticism White House aides who have said that Obama was willing to allow Bush-era tax cuts to expire on all Americans on Jan. 1 and automatic, across-the-board spending cuts to kick in the next day. He called their comments “reckless talk.”
Boehner repeated the long-standing Republican argument that raising tax rates would be detrimental to small businesses and “is not going to help our economy and it’s not going to help those seeking work.” Obama has insisted that any deal must include an increase in the tax rates for high earners.
But Boehner declined an opportunity to take a hard line on tax rates, skirting a direct question on whether he might be willing to accept some increase in the top tax rate, currently set at 35 percent.
“There are a lot of things that are possible to put the revenue that the president seeks on the table. But none of it’s going to be possible if the president insists on his position — insists on ‘my way or the highway,’ ” Boehner said when asked whether he might be able to accept a compromise top rate of 37 percent. “That’s not the way to get to an agreement.”
The Republican leader pointed out that he had offered on Monday to raise tax revenues by $800 billion over the next decade by ending or reducing tax breaks, particularly on the wealthy. The Republican plan would cut spending by $1.4 trillion, including by trimming annual increases in Social Security payments and raising the eligibility age for Medicare from 65 to 67.
“When is he going to take a step toward us?” Boehner asked of Obama.
At the White House, officials used Friday’s mixed jobs report, with its modest growth in hiring, as an argument to embrace Obama’s plans to avoid the fiscal cliff with a package of rate hikes for the rich and public works spending and refinancing help for struggling homeowners.
“Most pressing, President Obama has proposed, and the Senate has passed, an extension of middle class income tax cuts that would prevent the typical middle class family from facing a $2,200 tax increase at the beginning of next year,” said Alan Krueger, chairman of Obama’s Council of Economic Advisers.
Tax cuts enacted during President George W. Bush’s first term are scheduled to expire Dec. 31 when they would automatically return to rates in place during President Bill Clinton’s administration. Obama wants those increases only to affect households with earnings of more than $250,000.
Obama is insisting that rates for upper income taxpayers rise and also wants permanent authority to prevent Congress from blocking increases in the nation’s borrowing limit. The government is on track to hit its $16.4 trillion debt ceiling later this month, though the Treasury could extend the day of reckoning to February.
Separately, top House Democrat Nancy Pelosi of California, called on GOP leaders to schedule a vote on Senate-passed legislation to hike the top two tax rates for individual income exceeding $200,000 and family income over $250,000.
“Why are you not bringing this to the floor?” Pelosi said. “Is this a forever, forever protection of the wealthiest people in the country at the expense of the middle class?”