White House fiscal offer gets Republican scorn

White House fiscal offer gets Republican scorn

House Minority Leader Nancy Pelosi, D-Calif, flanked by Rep. Sander Levin, D-Mich, left, and Rep. Steve Israel, D-NY, right, speaks to reporters just after meeting with Treasury Secretary Timothy Geithner on the fiscal cliff negotiations, at the Capitol

Washington:  A top Republican declared that "no substantive progress has been made" in two weeks of talks between President Barack Obama and a divided Congress on looming austerity measures that threaten to send the country back into recession if a deal can't be made to avoid them by the end of the year.

Republican House Speaker John Boehner's comment on Thursday came after a closed-door discussion 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," Boehner declared.

Democrats swiftly replied that any delay in progress was the fault of Republicans who refuse to accept Obama's call to raise tax rates on the richest Americans.

"There can be no deal without rates on top earners going up," White House press secretary Jay Carney said.

Barely a month remains until Bush-era tax cuts expire and deep across-the-board spending cuts would take effect on January 1. Obama has said he would like to have a deal made before Christmas.

Economists warn that sending the economy over the so-called "fiscal cliff" would trigger a recession.

To avoid the danger, Obama and Congress are hoping to devise a plan that can reduce future deficits by as much as $4 trillion in a decade, cancel the tax increases and automatic spending cuts and expand the government's ability to borrow beyond the current limit of $16.4 trillion.

Officials on Thursday said the White House is seeking $1.6 trillion in higher taxes over a decade and an immediate infusion of money to aid the jobless and help hard-pressed homeowners.

In exchange, the officials said, 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 popular benefit programs over a decade.

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.

The White House also wants a new stimulus package to aid the economy, with a price tag for the first year of $50 billion.

In political terms, the White House proposal is a near mirror image of what officials have said Republicans earlier lay down as their first offer, including a permanent extension of income tax cuts at all levels.

Senate Majority Leader Harry Reid told reporters, "We're still waiting for a serious offer from Republicans."

The White House also circulated a memo that said closing tax loopholes and limiting tax deductions - a preferred Republican alternative to Obama's call to raise high-end tax rates - would be likely to depress charitable donations and wind up leading to a middle-class tax increase in the near future.

Obama travels to Pennsylvania on Friday to campaign for his tax proposal.

Boehner, who will begin a second term as House speaker early next month, has appealed to his party members to remain united.
Story First Published: November 30, 2012 08:14 IST

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