Washington (CNN) - The White House and Congressional Republicans are squaring off in negotiations to avert the fiscal cliff, with each side accusing the other of blocking a deal.
For the first time we're getting a look at what the White House is offering to break the stalemate. Republicans consider it an overreach. Democrats make clear it's a first offer, to get specific on the numbers.
– Follow the Ticker on Twitter: @PoliticalTicker
Treasury Secretary Timothy Geithner and White House Director of Legislative Affairs Rob Nabors presented the details while making the rounds on Capitol Hill Thursday.
The headlines? The White House is asking for $1.6 trillion dollars in new taxes. This would include the president's campaign pledge to raise tax rates on families who make $250,000 a year and more. It would bring in additional money by closing loopholes, limiting deductions, raising the estate tax rate to 2009 levels and increasing capital gains and dividends taxes.
Republican sources tell CNN the $1.6 trillion figure is higher than any number the White House had previously presented and was so disarming, according to one source, it set the talks back.
Democrats say the GOP is feigning outrage. In September 2011, Obama first proposed raising taxes one and a half trillion dollars - at that time to pay for the so-called Jobs Bill. Republicans dismissed it as a political stunt with no chance of movement.
It would seem the White House is digging in on its position on taxes - or at least making their stance clearer to the Republicans and the public.
Reflecting a new aggressive posture by the Democrats, the proposal laid out by Geithner also called for additional spending, including $50 billion in new stimulus spending next year, a home mortgage refinancing plan, an extension of unemployment insurance and an extension of the payroll tax cut. It includes a permanent mechanism to vote on a debt limit increase, which would avoid the kind of crisis the U.S. faced in the summer of 2011.
In return, according to multiple sources, the Obama administration is offering to find $400 billion in new cuts to Medicare and other entitlement programs, with the specifics to be hammered out next year.
While Republicans called these proposals unbalanced and unreasonable, White House aides made clear the president is ready to take a counter offer.
This all amounts to an elaborate negotiating dance. With time running out until tax rates automatically rise and drastic spending cuts kick in - part of the so-called sequester - both sides are playing for leverage against the clock.
Democrats are emboldened by electoral successes and that the president won a second term while pledging to do what the Republicans are still objecting to: raise tax rates for the wealthiest. Democrats believe the Republicans must and will relent on that point.
To that end, CNN learned in a phone call Wednesday night Obama told Boehner there would be no deal unless the GOP agrees to raise tax rates for the wealthiest. That means recently floated alternatives – including closing loopholes or limiting deductions - would not be enough on their own. Rates must go up as well for the top 2% of income earners.
Republicans tried to turn the conversation away from taxes, insisting the real debate should be about spending cuts.
"Despite claims that the president supports a balanced approach, Democrats have yet to get serious about real spending cuts," Boehner told reporters Thursday.
Reflecting a growing sense of pessimism among Republicans, the speaker added, "no substantive progress has been made in the talks between the White House and the House over the lat two weeks."
In a statement that accused Republicans of blocking a deal to protect "the very wealthiest individuals," White House Deputy Press Secretary Josh Earnest responded to the GOP in an email.
"The President has already signed into law over $1 trillion in spending cuts and we remain willing to do tough things to compromise, and it's time for Republicans in Washington to join the chorus of other voices - from the business community to the middle class Americans across the country - who support a balanced approach that asks more from the wealthiest Americans," Earnest said.
Here is my solution. Keep tax rates where they are and cut out all deductions and credits, including the tax break for employer provided health care. My tax form should fit on one sheet of paper with 12 point font.
as long as the clueless GOP clings to their no tax increase drivel, there will be no progress. it is ignoring the will of the majority of americans and they will take the fall. they rail against policies that they want and have a majority on as "ignoring the people" but ignore it when it tilts against them.
Truth please. The Obama stimulus is only $50 million. As to demonizing Ryan- think privatizing Medicare has anything to do with that? You can't fix the Bush spending spree off of the backs of the elderly and the middle class.
I added them together as stated except erred in that it is a billion not million. $150B new pulic works / stimulus spending with $50B next year. You can keep the Hugo Chavez/Obama approach of trashing those who make something of themselves but the GOP has stated agreement to $800B in new tax revenue. Obama is continuing to put his social and political agenda above revenue about growth and refuses to budge on cuts. I know democrats think they own the country but the House is controlled by the GOP so sorry compromise will have to occur.
Republicans are going to follow Grover right over the cliff to permanent minority status.
.......The gop is simply SCARED of the T Party. Otherwise, this would have been agreed to last year.
Our problems are much larger than taxes which the dems fail to realize! Why not extend all the cuts, avoid the "cliff" and work together on an acceptable solution? Because the dems dont want compromise they want a blank check and no cap or budget! That doesnt work for anyone in this nation regardless of which party you align with. And as many of you continue to reference the vote, it was close and we also voted to keep those republicans in the house because it is the only thing keeping the dems in check. He is President Obama, not king.
I want more and more taxes on the bloated in this country. The only thing the rich are capable of inventing is fattening food, diet pills, and debt. Not to mention destruction of all that is natural on the planet at the expense of the people, whose rebuilding tools they want to limit.
As long as you keep selling "pet rocks", you should be ashamed of trying to take the credit for anything good in this country. God forbid the people want a little more than an early heart attack, and a $900 telephone to look back on.
definitely the most left-leaning article i've seen in a while. not because of it what it says boldly, but because Obama's outlandish one-sided proposal is viewed as "balanced" and Boehner is called "pessimistic". maybe your writers don't realize it, but their hard-left media disposition stinks up their articles.
Rahm Emanuel taught the President well. "Never let a crisis go to waste." Chicago politics at its finest. If the Republicans cave in, Obama takes political credit for the George Bush tax cuts (the irony is tremendous). And if they don't cave in, Obama accuses the Republicans of taking away the George Bush tax cuts from the middle class. Amazing but sad. Statesmen and women are supposed to serve us as an honor. Obama is a politician, not a statesman. Politics FIRST, country LATER.
The Party of NO has got to GO
The GOP is pretending bluster again...they first asked for specifics, and then when they got them, they are unwilling to negotiate!
I say lets go over the fiscal cliff! It's going to hurt a heck of a lot but at least we'll finally be moving our debt in the right direction. Neither political party is 100% correct in their demands so its time for the entire country to suffer so our nation can be saved!
Chill, folks. This is a negotiation. All this breast beating and outrage is stagecraft. At ten minutes before midnight we will find out about the "real deal", and that will tell us what we, as ballot casters, need to know.
Republicans do not care about serving people. Hearing what nonsense Newt Gingrich was discussing with Grete (on Fox News) last night, I was almost to flaw up. He said that election is two years away from now, therefore republicans should not care. Hmmm! they are there just only to feel their stomachs.
republicans are not too smart. They have no cards to play in the tax issue because the President can wait until January 1 and the Bush tax cuts expire and republicans will get the blame. republicans will then vote to reduce taxes on the middle class but they have already lost. After that the republican party will go the way of the Whig party.
@ Greater Good @ 10:42 am – – – after reading your comment – I agree with you – It happened to me – I worked for a manufacturing plant for 28 + yrs . They cut & cut & cut & cut & cut – to the point where the workers was doing the work that 4 or 5 people USED to do – Guess what happened ? They decided to sell it / shut it down / it eventually moved overseas – Bottom line is this : The so called "Job Creators" Don't Care about People, period. All they care about is their Bottom Line. If they shut you down, or if you have to do the work – for everytime somebody is Off for some reason, or another – or retire) You have to Bear the Brunt of doing the Jobs of 6 or 7 or 8 different people. That's the Mind-set of these so called Job Creators, now days. They really don't care about anybody – the bottom line is the only thing they care about. You Cannot Keep "Downsizing" and "Cutting" – You can't get Blood out of a Turnip, but that's only one of the reasons the Factories went off shore.
See, this is why you loser conservatives are losers. That may not be alot of cash, but you guys running around saying Obama is not putting any spending cuts on the table is stupid. At least read the freaking article.
And in no place in said article does it say that Obama is trying to subvert congress to increase the debt limit. I can only surmise that you either didn't read the article and came to this conclusion on your own or via Rush approved talking points. Either way, you guys are not the brightest in the class.
The liberals might not like to hear it, but the rich pay for all their social programs and for their jobs. They are the ones who put their money on the line to create new companies. Raise taxes too much and they just might pack up their toys and go somewhere else. Britain lost half of their rich when they raised taxes and ended up getting less in total taxes.
@Randy – SPENDING needs to be our focus! SPENDING SPENDING SPENDING! We cannot continue, as a nation, borrowing from other nations to pay for programs we dont need or dont work. Even though I am a middle class American, who stands to bear the brunt of the fiscal 'cliff', I am shocked at the blatant disregard that the President has for commerce, capitalism, investments, etc. We cannot continue to encourage investment (by individuals and companies) by raising taxes on investments! It doesnt work that way.
While I agree that SPENDING should be the focus, the problem we face is that neither side can agree on WHAT TO CUT. The Dem's want to cut Defense spending (which is 50% of our budget) and the GOP refuses. The Dems have already offerred cuts on the so-called entitlement programs. Taxing the wealthy will not solve the fiscal woes, but many of them have investment income taxed at a base 15%. Mitt Romney – with a $250+ Million fortune – (and Warren Buffet too) both pay a lesser rate of tax on their income than I do!!!!!!!! Is that fair when I have far less earnings?
You have a very misguided view of basic business process if you believe the POTUS has a "blatant disregard" "for commerce, capitalism, investments, etc.". Lowering personal taxes on the so-called job creators (1%) does NOT CREATE JOBS. INCREASED DEMAND for a product or service creates jobs! Business owners factor their tax rates into their annual budgets, and determine what they have to reinvest for the next year. That includes payroll, healthcare, stock options, salaries and profits.
You know, I'd love to have a couple $million hanging around that I don't need to live on – to invest!! Being taxed at the CG rate would cut my Fed tax burden in HALF !! It's high time the 1% started paying their FAIR share for the opportunities this country has provided them – regardless of the $$ amounts involved.
FDR gave us the "New Deal"... the GOP offers us the "Raw Dea"...
Come on Boehner! Take the lead and stop following the Tea Party. It is well past time to put on the big boy pants and pay our taxes.
To the people who believe raising taxes will only hurt the Rich, let me tell you a story. I am a tax manager and everytime the powers that be raise taxes, the taxes get pushed to the consumers. Do you know who the consumers are? You and me. The Rich do not eat the taxes and Obama and others want you to believe.
We – The 99% of the American People who are NOT Venture Capitalists – have been SUBSIDIZING the 1% for the last Two Decades because we were PROMISED that the Historically MUCH LOWER Tax Rate would STIMULATE the Economy – It has NOT. It has Created a PARASITIC Class that FEEDS Upon the Rest of Society without adding VALUE. For Instance – at Least a THIRD of the Price of OIL is the Price of SPECULATION or GAMBLING in Investment Casinos. These PARASITES are so CRIMINAL that they Bet OUR MONEY on Deals they Set-Up to FAIL then Bet THEIR Money on the FAILURE and STOLE Our Homes and Businesses with the Trillion Dollars they were given to FAIL.
Boehner apparently likes being a Republican Speaker so much that he's going to do his best to make sure that he's the last one.
Actually, reducinig the GOP to a permanent and shrinking minority party in this country might, unwittingly, be the best service Boehner and the tea party could ever do for this nation.
No details from the dems