No one relents in spending and tax standoff in Washington

WASHINGTON — A year-end deadline approaching, negotiations to avoid an economy-rattling "fiscal cliff" appeared at a standstill Monday. Republicans pressed President Barack Obama to name specific spending cuts he will support, while the White House insisted the GOP agree explicitly to raise tax rates on upper incomes.

At a campaign-style event in Michigan, Obama warned his listeners their taxes will rise on Jan. 1 without action by the Congress. "That's a hit you can't afford to take," he declared.

He spoke one day after meeting privately at the White House with House Speaker John Boehner, R-Ohio, whose office expressed frustration with the talks to date.

"We continue to wait for the president to identify the spending cuts he's willing to make as part of the 'balanced' approach he promised the American people," Boehner said a written statement.

The negotiations are designed to prevent across-the-board tax increases and spending cuts scheduled to begin at the turn of the year, a combination that economists say poses the threat of a new recession.

While leaders in both parties say they are eager to avoid that "cliff," negotiations on a plan to cut deficits by other measures have turned into a major postelection showdown between opposing sides in a divided government.

Many Republicans agree that Obama and the Democrats hold most of the political leverage, given the president's re-election after a campaign in which he said the wealthy should pay more in taxes. Republicans, however, have increasingly expressed frustration in recent days as they accuse Obama and the Democrats of failing to talk in specifics.

In talks that ended in failure 18 months ago, according to aides in both political parties, Obama had tentatively agreed to a proposal to raise the age of Medicare eligibility from 65 to 67 beginning in a decade, and had also said he would accept a change to slow the annual cost-of-living increases for recipients of Social Security and other federal benefits.

This time, the two sides have advanced opening proposals that are short of specifics and reflect different priorities.

Obama's plan would raise $1.6 trillion in revenue over 10 years, in part by raising tax rates on incomes over $200,000 for individuals and $250,000 for couples. He has recommended $400 billion in spending cuts over a decade.

Boehner's plan, in addition to calling for $800 billion in new revenue, envisions $600 billion in savings over a decade from Medicare, Medicaid and other government health programs as well as $300 billion from other benefit programs and another $300 billion from other domestic programs. It would trim annual increases in Social Security payments to beneficiaries, and it calls for gradually raising the eligibility age for Medicare from 65 to 67, beginning in a decade.

No one relents in spending and tax standoff in Washington 12/10/12 [Last modified: Tuesday, December 11, 2012 12:16am]

Copyright: For copyright information, please check with the distributor of this item, Associated Press.
    

Join the discussion: Click to view comments, add yours

Loading...