WASHINGTON (AP) — The U.S. talks on avoiding the "fiscal cliff" appeared stalled once more on Thursday as the Republican-controlled House moved ahead on a backup bill that Democrats say won't get through the Senate and the White House says President Barack Obama will veto.
Dampening the holiday season, Senate Majority Leader Harry Reid said lawmakers would return to the Capitol next Thursday, just after Christmas, as a deal remained elusive before the Jan. 1 deadline. A recession-threatening combination of tax increases and deep spending cuts will kick in if a deal isn’t made on tackling the country’s chronic deficit spending.
Obama and House Speaker John Boehner had appeared to be making progress in recent days. But Boehner, the most powerful Republican in Congress, then made the surprise offer of a bill that would raise taxes on people earning over $1 million a year. That would spare most workers from a tax hike but leave in place painful budget cuts to the military and domestic agencies.
Obama has wanted taxes to rise on household incomes of more than $250,000, but he had softened that stance to more than $400,000 as a deal had appeared closer.
A supremely confident Obama has dismissed Boehner’s “Plan B” proposal, telling reporters that he and Boehner were just a few hundred billion dollars apart on a 10-year, $2 trillion-plus deficit-cutting pact.
Boehner on Thursday told reporters he would continue trying to strike a deal with the president, who he has said will bear responsibility for “the largest tax increase in history” if he makes good on his veto threat.
The latest standoff typifies the partisan fighting that has marked Washington in recent years.
But even some Republicans are not happy with Boehner’s backup proposal, especially some conservative, anti-tax dissidents.
Republicans have told senior administration officials that Boehner decided to put forward his Plan B after he concluded he could not get enough Republican support for the proposal he made to Obama over the weekend, according to a senior administration official.
On paper, the two sides are relatively close to an agreement on major issues, each having offered concessions in an intensive round of talks that began late last week.
Obama repeated that he is ready to agree to spending cuts that may cause distress among some fellow Democrats, but he saved his sharpest words for Republicans.
“Goodness, if this past week has done anything, it should just give us some perspective,” he said in a reference to the school.
Speaking of Republicans, he said: “It is very hard for them to say yes to me. But at some point, they’ve got to take me out of it.”
Boehner did not slam the door on further compromises in his brief appearance before reporters. “Republicans continue to work toward avoiding the fiscal cliff,” he said.
In the talks to date, Obama is now seeking $1.2 trillion in higher tax revenue, down from the $1.6 trillion he initially sought.
He also has offered more than $800 billion in spending cuts over a decade, half of it from the Medicare and Medicaid health care programs for the aging and poor.
By contrast, Boehner’s most recent offer allowed for $1 trillion in higher taxes over a decade, with higher rates for annual incomes over $1 million. His latest offer seeks about $1 trillion in spending cuts.
