WASHINGTON (CNN) - President Barack Obama presented congressional Democratic leaders Monday with a proposed deal with Republicans that would extend Bush-era tax cuts for two years and unemployment benefits for 13 months while also setting the estate tax at 35% for two years on inheritances worth more than $5 million, a senior Democratic source told CNN.
The deal also includes a temporary 2% reduction in the payroll tax to replace Obama's "making work pay" tax credit from the 2009 economic stimulus package for lower-income Americans, the senior Democratic source said. As currently crafted, the deal would prohibit amendments by either party, according to the source, who spoke on condition of not being identified by name.
House Democrats, who passed a measure extending the Bush-era tax cuts for income up to $250,000 a year, indicated earlier Monday they were unhappy with the negotiations that the White House was conducting with congressional Republicans.
"We won't rubber stamp a deal between the White House and (Senate Minority Leader) Mitch McConnell," one Democratic congressional source told CNN. "We want to make it clear. Don't take our support for granted."
Speaker Nancy Pelosi, D-California, and Majority Leader Steny Hoyer, D-Maryland, were among Democratic leaders who attended a White House meeting with Obama and Vice President Joe Biden to discuss the proposed deal.
According to the senior Democratic source, Obama and Biden told the congressional Democrats that the proposed deal was the best they could expect.
Liberal House Democrats are believed to be among the most reluctant in Congress to agree to a deal extending all of the 2001 and 2003 tax cuts.
The House measure, which was blocked from consideration in the Senate by a Republican filibuster, would cause tax rates to increase to 1990s levels for individuals making more than $200,000 a year and families earning more than $250,000. Senate Republicans blocked a similar proposal that set the income threshold for higher tax rates at anything over $1 million.
Top senators from both parties had indicated Sunday that a deal linking the extension of lower tax rates for everyone with extended unemployment benefits was likely. Congress would continue working on a long-term plan to reduce the nation's debt.
Democrats contend the nation must prevent working-class Americans from facing higher taxes, as promised by Obama in his 2008 election campaign, but can't afford the extra hundreds of billions of dollars it would cost to maintain the tax cuts for the wealthy. Republicans argue that the economy remains too weak to allow anyone's taxes to increase.
Earlier Monday, Obama reiterated his position that extending the cuts for the wealthiest Americans would be fiscally irresponsible, and stressed the opinion of Democratic leaders that an extension of unemployment benefits needs to be part of any agreement with the GOP.
"We have got to find consensus here because a middle-class tax hike would be very tough, not only on working families, it would also be a drag on our economy at this moment," Obama told an audience in Winston-Salem, North Carolina.
"We've got to make sure that we are coming up with a solution even if it is not 100% of what I want or what the Republicans want."
CNN's Alan Silverleib, Tom Cohen, and Brianna Keilar contributed to this report
It's a damn shame that the republicans are able to hold an entire nation hostage like this. The GOP wouldn't go along with extending unemployment unless the democrats agreed to extend tax cuts for everyone. THAT is class warfare, and to think that Ginrich said Obama was guilty of class warfare because he didn't think that people making $200,000 and couples making $250,000 deserved tax cuts.
I would have told the GOP to get stuffed. Here is a fact that I bet not everyone knows. The so-called tax cuts us normal people get amounts to $30 a MONTH. Thats right. Hell, I would have given up my share just to see the rich getting taxed at an appropriate level. The unemplyment extention being used as a bargaining chip by the republicans is as low as you can get though.
So let me get this straight, we are going to extend tax cuts for the wealthy= Government revenue does not return to pre-Bush level, and extend un-employment benefits= Increase in government spending.
Increased Government Spending + Decreased Government revenue= Bankrupcy?
This is no way to run a business.
Sad day in America.
NO NO NO NO NO. We have HAD IT with Dems caving to the GOP and pretending that giving them exactly what they want, just because they in turn pretended they wanted something far worse and much further to the right. TOTALLY UNACCEPTABLE, PERIOD. 74% of the country DOES NOT WANT TAX CUTS FOR THE RICH. We want the deficit and debt to be addressed. We want the wealth gap to STOP growing at an ever-accelerating rate and to reverse direction. We want jobs, not free handouts to the wealthy so they can stick it in their investment accounts. WE WANT FACT-BASED DECISION MAKING FROM OUR GOVERNMENT. hese tax cuts were TEMPORARy, were WRITTEN TO EXPIRE, and should have been allowed to NO MATTER WHAT. They are the LARGEST CONTRIBUTING FACTOR TO OUR NATIONAL DEBT AND DEFICIT (with the Iraq and Afghanistan wars a close second). They are UNSUSTAINABLE. They are an EXCUSE generated by the GOP and big business to carve out even more of the country's wealth and assets for their own benefit at the expense of the middle class.
TAX CUTS DO NOT CREATE JOBS. This has NEVER been proven and has, in fact, been COMPLETELY DEBUNKED. CNN and the rest of the "news" media have STUDIOUSLY IGNORED STUDIES FROM DOL AND CBO STATING THAT TAX CUTS ARE NOT AN EFFECTIVE ECONOMIC STABILIZER OR MEANS FOR CREATING GROWTH. This is SOLELY a "compromise" using the blood, sweat and tears of the middle-class as the "well, unfortunately, you can't win every time." NO, but you CAN LOSE EVERY TIME, which is what the government is doing to the middle class AT EVERY TURN. The leaders of the the Dems in Congress should tell Obama and Biden to go eat the proposal...or maybe hhold them down and feed it to them...literally. ENOUGH IS ENOUGH.
WHERE'S ROBESPIERRE WHEN WE NEED HIM!?!?!?!?!?!
Why doesn't this worthless excuse for a leader just hand the keys to the White House to Mitch McConnell and spend the next two years. I'm a lifelong Democrat and cant wait for 2012 so we can kick this peice of garage to the curb.
Extending jobless benefits more, is a mistake.
Basically, the government wants to give away money, rather than create jobs. That is just wasteful. The unemployment benefits must NOT be extended, to FORCE the government to take some real action, to create jobs.
Just in........... Average Americans have been sold to the highest bidder! RIP United States of America, the corporations are now your leader...........
God help us if Obama sells us down the river. Do the Republicans want to lower the defficit or not? They sure don't act like it with giving the wage earners over $250,000.00 a BIG FAT TAX break.
Next election only vote for those that can lead our Nation and not cut deals with the richest of us.
This does not sound like a compromise to me. Holding the tax cuts for the most wealthy for two years is just no logical. Many in that category of folks earning over one million dollars have said they do not need this tax cut. That being said, just who are the Republicans trying to please? This additional increase to the national debt is not warranted at all.
President Obama needs to hold the line. It is time for Republican compromises. Their attitude and desire to keep the tax cuts for the wealthiest Americans is very self-serving. The people who have suffered the most during this recession may be getting continued tax cuts but those who suffered least and have rebounded shoud be voicing their opinions over their tax cuts. Just say NO!
If you want to blame this adminstration for having to deal with the republicans.. grow a pair and be mad at the Republicans, they are holding up progress. Besides this country voted Republicans into control of the house without thinking about the results. Blame yourselves
Now THIS is chicken crap!
AND NONE OF IT IS PAID FOR!!!
Reject it. Let the Bush tax cuts expire, then deal. Republicans are not serious about the debt and deficit issues, and the only portion of the population they support are the wealthy. Enough is enough.
If the republicans are going to get everything they want – let's vote them in so they can take the BLAME.
How about playing hard ball dems just say no
I think the polls, if they compromise on the tax extensions, will bode very poorly for the Democrats. Is no one going to put their foot down and say "enough"! We've got to start being fiscally responsible now. Starting with those who would feel it the least is a start. Next, we'll all need to feel the pain. I think the country understands that we need to feel a little pain in order to keep what we've got. Very discouraging news.
How about what WE THE PEOPLE WANT ...
Why are a few ARROGANT Republicans allowed to choose, against the will of the people ?????
stop the madness nancy ,,,,those millionares and billionares need to be tax,,this is nuts,,,,
The election is over and it is time to put our political leaders to work especially the Republicans. The Republicans won the election due to fear mongering, betting people against the president not only on his policies but his personality as well. How soon do the Republicans forget who opened the flood gates and almost destroyed the financial market our country. Lately they were fighting in extending the Bush tax cut and threaten they will not pass the unemployment benefits for the millions that are out of work. I just do not understand they want to see people suffer, go hungry and cannot meet ends. Those people pay taxes like everyone but we are more concerned about saving taxes for the millionaires that they think will create jobs. Now they want to compromise and come up with a bipartisan agreement with the administration and come up with a solution. In these dire time we have to think that our country does not need bickering politicians but politicians with a purpose. The president is doing all he could to compromise but the Republicans think it is unacceptable. I salute the president trying to compromise even though some of his Democrats are against him. This is not giving up to the Republicans demand it is our duty to protect the people of this country and lead us to a prosperous future. This is not a game is a reality our leaders need to work together acting like grown ups and not play the blame game. Hopefully this will be a good start and bring our country to its economic dominance in the world. It can be done what we need is harmony, open mindedness, stop political bickering and look out for the middle class. God Bless our country.
These democrats make me sick, they wouldn't even stick together on passing the tax cuts for everyone making under 1 million, some voted against that, I bet they all vote for this, their hands are then in the pockets of the wealthy too. Wonder what else we have in store for the Richest 2 percent the next 2 yrs. I guess they'll be doing away with anything that hurts their bank accts iin order to get anything passed. What a joke the gov is. Jane
Press hard, three copies on that deal. If the congressional Democrats wants to curry to the far left then we can wait until January 1st. But for the sake of the unemployed and the economy it would be best to get all the acting and whining over with and sign the deal.
Wow Obama is the most obtuse individual ever. When you are fired in 2 years Obama don't even think of asking for unemployment insurance. Three years of Unemployment and this moron thinks that is OK? There comes a time when you just have to take a job just to take a job. I went to college and got a degree as well but once the jobs in my industry started drying up I went back to school and got new skills with the last 2 weeks of unemployment money. Sure it was not in my field but it paid my bills. I then did that job for two more years till jobs in my industry started coming back. I went from being an animator to an EMT back to working in Animation. Those 2 1/2 years as an EMT were some of the most rewarding days of my life and I don't regret it.
Good Plan. As always ... the first plan.
35% on estates over 5 million!!!! Come on, these folks already paid taxes on this wealth. This amounts to nothing more than robbery of the successful portion of Americans once again!!!
"George W. Bush’s job approval rating as president has spiked to 47 percent, according to a Gallup poll released Monday.
That’s one point higher than President Barack Obama’s job approval rating in a poll taken the same week."
lol.....well now, it appears the "evil" George Bush is more popular than Barry Hussein. Epic fall. Epic fail.
Dems stand your ground and let the Bush tax cuts "EXPIRE"
If they don't, I won't vote for them ever again