By Susan Davis and Aamer Madhani, USA TODAY
WASHINGTON - With the "fiscal cliff" looming, House Speaker John
Boehner presented a plan to fellow GOP lawmakers Tuesday to move forward
with a bill that will raise tax rates for Americans making more than $1
million if they fail to reach a final deal with President Obama.
said his Plan B does not mean he has given up on negotiations with the
White House, but the speaker said he believes that the threat of tax
rates rising for all Americans is too great not to have a backup plan.
weeks, Senate Republicans - and a growing number of you - have been
pushing for us to pivot to a 'Plan B,'" Boehner told House Republicans.
"I think there's a better way. But the White House just can't seem to
bring itself to agree to a 'balanced' approach, and time is running
The maneuvering is more tactical than pragmatic. Senate
Majority Leader Harry Reid, D-Nev., made it immediately clear that the
Democratic-controlled Senate would not take up the speaker's alternative
proposal. "Now is the time to show leadership, not kick the can down
the road," Reid said. White House spokesman Jay Carney also rejected the
proposal because it "can't pass the Senate and therefore will not
protect middle-class families, and does little to address our fiscal
challenges with zero spending cuts."
Carney added that the
president is still working toward a final deal that cuts future deficits
by about $4 trillion over the next decade. "We are very close to being
able to achieve that," he said, "And the president has demonstrated an
obvious willingness to compromise and to move more than halfway towards
Under the speaker's 'modified Plan B' scenario,
the U.S. House would take up a bill to extend the expiring George W.
Bush-era tax cuts for all but the top 2% of earners. However, it would
not turn off the looming "sequester," a painful $1.2 trillion in
automatic spending cuts that will begin Jan. 1. The speaker also said
proposals addressing the expiring Alternative Minimum Tax patch and the
estate tax could be included in his package, which could be on the floor
as early as Thursday.
The plan met with resistance from
Republicans who oppose any deal to raise taxes. "I'm a 'hell no,'" said
Rep. Raul Labrador, R-Idaho, a conservative freshman.
recent fiscal cliff offer came late Monday from the White House. It
included $1.2 trillion in revenue and $1.2 trillion in spending cuts
following an offer over the weekend by Boehner for $1 trillion in
revenues for $1 trillion in spending cuts. The president's offer
included concessions on tax rates beginning at incomes over $400,000 for
couples, a change from his campaign pledge to let the tax cuts expire
on those making more than $250,000.
The speaker rejected the
offer because Republicans said they believe the White House uses
budgetary gimmicks to account for their $1.2 trillion in spending cuts.
He told reporters that a "balanced" deal will likely have to include
equal tax raises and spending cuts. "Most people would agree that that's
balanced," Boehner said. The speaker and the president also remain at
odds over raising the debt ceiling, the nation's borrowing authority, as
part of a final deal, as well as what entitlement cuts to include.
want to change the way cost-of-living adjustments are calculated for
Social Security beneficiaries, but Boehner softened his tone Thursday on
earlier GOP proposals to raise the eligibility age for Medicare. "I
don't believe it's an issue that has to be dealt with between now and
the end of the year," he said.
White House negotiator Rob Nabors
briefed House and Senate Democrats on the White House offer, which
includes extensions for unemployment benefits but no proposal to
continue the 2% payroll tax holiday, which is likely to be met with
resistance from some Democratic lawmakers. Asked if he could support a
final deal that includes changes to calculating benefits, Reid - who has
opposed it in the past - said "this isn't going to be a situation where
we're going to vote on a particular provision in the bill. It's going
to be a framework to do something about the long-term security of this
Obama also continues to seek additional stimulus
spending for infrastructure projects that Democrats support but
Republicans oppose. Senate Finance Chairman Max Baucus, D-Mont., told
reporters that the president's offer was "probably not what the final
deal is going to be."
Despite the lingering differences, the
president and the speaker have made significant progress toward reaching
a final deal, and lawmakers on both sides were optimistic Tuesday that
the fiscal cliff could be avoided. "I think that the best Christmas gift
that we could give America is an agreement," said Rep. Cathy McMorris
Rodgers, R-Wash, "I'm confident that we can get it done. This is our
moment. And this is our moment to do what's good and right for America."
Added Baucus: "They're doing it - the speaker and the president - Godspeed. Hope they make it."
Contributing: Jackie Kucinich and David Jackson