Washington (CNN) – One of the reasons Tuesday night's conversation between President Barack Obama and John Boehner did not go well was because the GOP House speaker sent the White House a fiscal cliff proposal calling for a permanent extension of Bush-era tax cuts for all Americans, including for incomes in the top 2%, a Democratic source said Wednesday.
Democrats took the GOP counter offer to mean that tax reform cannot result in any marginal rates higher than current law, according to the source, who said Boehner's proposal was a "sign" to Democrats that "Boehner and the GOP are unwilling or unable to do any sort of deal that can pass the Senate or be signed by the president."
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Democrats favor raising tax rates on wealthy Americans as part of a deal to avoid the year-end fiscal cliff, while Republicans want to extend the Bush-era cuts for all income levels.
A Republican source insists the White House may have misinterpreted the latest GOP offer, since Boehner's offer includes tax reform down the road, which would render anything permanent moot.
The back-and-forth provides new insight into why the speaker described his call with the president as "deliberate" and "frank" in a Wednesday news conference.
Boehner explained that negotiations are stalled because the president won't come down on his $1.4 trillion figure for new revenue and won't up his figure for potential spending cuts.