President Obama summoned House Speaker John A. Boehner to the White House Thursday, but their talks over the looming “fiscal cliff” failed to break the impasse over taxes and clear the way for a deal to head off painful austerity measures set to hit in January.
After the 50-minute session in the Oval Office, aides to both men described the meeting as a frank exchange and said that the lines of communication remained open. But Boehner prepared to return to Ohio for the weekend, with no further negotiations on his schedule.
Video
Sen. Jim DeMint (R-S.C.) says President Obama will most likely achieve his push for increased taxes on wealthy Americans in “fiscal cliff” negotiations. DeMint is leaving the Senate for the Heritage Foundation in order to help Americans better relate to the conservative platform.
More fiscal cliff coverage
Ezra Klein
WONKBLOG | A new McClatchy-Marist poll finds Republicans are opposed to taxing or cutting anything.
Rosalind S. Helderman
The leaders of conservative groups warn Republicans in Congress not to cave to Democratic demands.
Jerry Markon and Peter Wallsten
Obama administration wants to limit deductions by high-income earners, including those given to charities.
Start here for an explanation of wonky terms and key issues in the looming fiscal crisis.
The late-afternoon invitation from the president surprised senior Republicans. But it did nothing to dispel the sense that hope is all but lost for sealing a far-reaching agreement to raise taxes, cut spending and avert the year-end cliff.
Obama’s top economic adviser, Gene Sperling, confirmed the gloomy outlook in a closed-door lunch meeting Thursday with Senate Democrats, according to those present.
Senior Senate Republicans, meanwhile, were at work on a fallback plan that would not significantly restrain the national debt but would at least avert widespread economic damage by canceling tax increases scheduled to take effect next year for the vast majority of Americans. That strategy calls for Republicans to capitulate to Obama’s demand to let tax rates rise on wage and salary income for the wealthiest 2 percent of taxpayers.
But the approach would also seek to thwart the Democrats by trying to block other steps that would increase taxes paid by wealthy taxpayers, including higher rates on investment income and limits on the value of itemized deductions. This strategy would produce only about $440 billion in new taxes and give the Democrats even less revenue than Republicans had previously put on the table. In his initial offer earlier this month, Boehner had said he could support $800 billion in new tax revenue.
With a relatively low price in new taxes, the strategy, if successful, would represent a tactical victory for Republicans and shift the political burden onto Democrats to make greater concessions on federal spending.
Senate Minority Leader Mitch McConnell (R-Ky.) has floated the strategy among Republicans in both chambers, according to lawmakers and senior GOP aides. So far, it has been rejected by Boehner and other House leaders, aides said.
But top GOP policy aides continued to refine the plan Thursday as a growing number of Senate Republicans clamored for action to prevent the fiscal crisis — for which, polls show, Republicans would be blamed.
“It’s bizarre. It’s truly bizarre. There’s no sense of urgency,” said retiring Sen. Olympia Snowe (R-Maine). “We’re lurching from deadline to deadline now. We do not want to create this as the new norm.”
The divide between Republicans in the House and Senate has become increasingly apparent in recent days. While House leaders have roundly rejected any strategy that would let tax rates rise, the ranks of Senate Republicans who are willing to accept a small tax hike and continue the fight over spending early next year continue to grow.
After the 50-minute session in the Oval Office, aides to both men described the meeting as a frank exchange and said that the lines of communication remained open. But Boehner prepared to return to Ohio for the weekend, with no further negotiations on his schedule.
Video
Sen. Jim DeMint (R-S.C.) says President Obama will most likely achieve his push for increased taxes on wealthy Americans in “fiscal cliff” negotiations. DeMint is leaving the Senate for the Heritage Foundation in order to help Americans better relate to the conservative platform.
More fiscal cliff coverage
Ezra Klein WONKBLOG | A new McClatchy-Marist poll finds Republicans are opposed to taxing or cutting anything.
Rosalind S. Helderman The leaders of conservative groups warn Republicans in Congress not to cave to Democratic demands.
Jerry Markon and Peter Wallsten Obama administration wants to limit deductions by high-income earners, including those given to charities.
Start here for an explanation of wonky terms and key issues in the looming fiscal crisis.The late-afternoon invitation from the president surprised senior Republicans. But it did nothing to dispel the sense that hope is all but lost for sealing a far-reaching agreement to raise taxes, cut spending and avert the year-end cliff.
Obama’s top economic adviser, Gene Sperling, confirmed the gloomy outlook in a closed-door lunch meeting Thursday with Senate Democrats, according to those present.
Senior Senate Republicans, meanwhile, were at work on a fallback plan that would not significantly restrain the national debt but would at least avert widespread economic damage by canceling tax increases scheduled to take effect next year for the vast majority of Americans. That strategy calls for Republicans to capitulate to Obama’s demand to let tax rates rise on wage and salary income for the wealthiest 2 percent of taxpayers.
But the approach would also seek to thwart the Democrats by trying to block other steps that would increase taxes paid by wealthy taxpayers, including higher rates on investment income and limits on the value of itemized deductions. This strategy would produce only about $440 billion in new taxes and give the Democrats even less revenue than Republicans had previously put on the table. In his initial offer earlier this month, Boehner had said he could support $800 billion in new tax revenue.
With a relatively low price in new taxes, the strategy, if successful, would represent a tactical victory for Republicans and shift the political burden onto Democrats to make greater concessions on federal spending.
Senate Minority Leader Mitch McConnell (R-Ky.) has floated the strategy among Republicans in both chambers, according to lawmakers and senior GOP aides. So far, it has been rejected by Boehner and other House leaders, aides said.
But top GOP policy aides continued to refine the plan Thursday as a growing number of Senate Republicans clamored for action to prevent the fiscal crisis — for which, polls show, Republicans would be blamed.
“It’s bizarre. It’s truly bizarre. There’s no sense of urgency,” said retiring Sen. Olympia Snowe (R-Maine). “We’re lurching from deadline to deadline now. We do not want to create this as the new norm.”
The divide between Republicans in the House and Senate has become increasingly apparent in recent days. While House leaders have roundly rejected any strategy that would let tax rates rise, the ranks of Senate Republicans who are willing to accept a small tax hike and continue the fight over spending early next year continue to grow.