White House seeks $1.6 trillion in higher taxes; GOP gives offer the cold shoulder
Carolyn Kaster, AP
WASHINGTON — The White House is seeking $1.6 trillion in higher taxes over a decade and an immediate infusion of funds to aid the jobless, help hard-pressed homeowners and perhaps extend the expiring payroll tax cut, officials said Thursday as talks aimed at averting an economy-rattling "'fiscal cliff" turned testy.
In exchange, the officials said, President Barack Obama will support an unspecified amount of spending cuts this year, to be followed by legislation in 2013 producing savings of as much as $400 billion from Medicare and other benefit programs over a decade.
The offer produced a withering response from House Speaker John Boehner, R-Ohio, after a closed-door meeting in the Capitol with Treasury Secretary Tim Geithner. "Unfortunately, many Democrats continue to rule out sensible spending cuts that must be part of any significant agreement that will reduce our deficit," he declared.
Boehner added, "No substantive progress has been made between the White House and the House" in the two weeks since Obama welcomed congressional leaders at the White House.
Democrats swiftly countered that any holdup was the fault of Republicans who refuse to accept Obama's campaign-long call to raise tax rates on upper incomes.
At the White House, presidential press secretary Jay Carney said, "There can be no deal without rates on top earners going up." Taking a confrontational, at times sarcastic tone, he said, "This should not be news to anyone on Capitol Hill. It is certainly not news to anyone in America who was not in a coma during the campaign season."
With barely a month remaining until a year-end deadline, the hardening of positions seemed more likely to mark a transition into hard bargaining rather than signal an end to efforts to achieve a compromise on the first postelection challenge of divided government.
Boehner suggested as much when one reporter asked if his comments meant he was breaking off talks with the White House and congressional Democrats.
"No, no, no. Stop," he quickly answered.
"I've got to tell you, I'm disappointed in where we are, and disappointed in what's happened over the last couple weeks. But going over the fiscal cliff is serious business."
Republican aides provided the first description of the White House's offer, although Democratic officials readily confirmed the outlines.
Under the proposal, the White House is seeking passage by year's end of tax increases totaling $1.6 trillion over a decade, including the rate hikes sought by Obama.
Obama also asked for approval by year's end of $30 billion to renew expiring jobless benefits, $25 billion to prevent a looming Jan. 1 cut in fees for doctors who treat Medicare patients and an undisclosed amount to help homeowners hit by the collapse in real estate values.
The White House also wants a new stimulus package to aid the economy, with a price tag for the first year of $50 billion, as well as an extension of the Social Security payroll tax cut that is due to end on Dec. 31, or some way to offset the impact of its expiration.
In political terms, the White House proposal is a near mirror image of what officials have said Republicans earlier laid down as their first offer — a permanent extension of income tax cuts at all levels, an increase in the age of Medicare eligibility and steps to curtail future growth in Social Security cost-of-living increases.
In exchange, the GOP has offered to support unspecified increases in revenue as part of tax reform legislation to be written in 2013.
The GOP said the White House was offering unspecified spending cuts this year. Those would be followed next year by legislation producing savings from Medicare and other benefit programs of up to $400 billion over a decade, a companion to an overhaul of the tax code.
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