Middle class tax cuts being squeezed by hardening lines over spending cuts
WASHINGTON -- A reprieve for the middle class from looming tax hikes was plunged into further doubt on Thursday, as House Speaker John Boehner suggested an unwillingness to allow Bush-era tax cuts to expire only on the nation’s wealthiest.
Despite ongoing negotiations between Democrats and Republicans to avert the “fiscal cliff,” lines appeared to be hardening as the House speaker comes under pressure to resolve the stalemate with Democrats. On Thursday morning, Boehner again asserted that President Obama was not making a serious effort to come up with a plan -- an accusation the White House dismissed.
The two men met for nearly an hour Thursday afternoon at the White House, but details about what if anything was accomplished at the meeting were not immediately disclosed.
Earlier in the day, Boehner, the top Republican in Congress, reiterated his stand against any increases in tax rates.
“The law of the land today is that everyone’s income taxes are going to go up on Jan. 1,” Boehner told reporters. “I’ve made it clear that I think that’s unacceptable. Until we get this issue resolved, that threat remains.”
The country is barreling toward a precipice of tax hikes and automatic spending cuts that analysts say could be disastrous for the country’s still-fragile economic recovery if not averted.
Even if a fiscal cliff deal is reached, another crisis looms in just months to again raise the federal debt limit. Obama wants Congress to give the executive branch permanent authority to lift the debt limit -- a proposal Boehner scoffed at.
“Congress is never going to give up our ability to control the purse,” Boehner said, adding that debate over raising the debt limit helps “bring fiscal sanity to Washington.”
White House spokesman Jay Carney said Thursday that a compromise was the best route out of the quandary, and he pressed Republicans to come up with a wish-list of specific spending cuts.
Despite the approaching year-end deadline, the House recessed Thursday and will return next week with very little time to take up a deal, which both sides insist is still in the works despite growing pessimism.
Boehner is clearly in a bind, as he finds himself squeezed from both sides of his party, hard-liners and pragmatists alike, who differ on the best course to avert not only the fiscal cliff but potential political damage.
Obama and Democrats have waged an election-style campaign to win public support over raising tax rates, and polls show most Americans favoring hiking taxes on the rich as part of the solution. To make his case, the president offered interviews to local television reporters from across the country. Earlier this week, he traveled to Michigan to make his case.
Democrats have the public’s backing, according to a survey released Thursday by the Pew Research Center. According to the poll, 55 percent of Americans said Obama is making a “serious effort” to work with Republicans, and only 32 percent said Republicans were doing so.
Meanwhile, Boehner, the GOP’s lead negotiator on the fiscal cliff, was viewed more unfavorably than favorably, 40 percent to 28 percent, which could put him at a disadvantage against the president, whose approval rating has climbed.
Nearly three-fourths of those taking part in the survey, which was conducted late last week, agree that deficit reductions should be addressed by a combination of spending cuts and tax hikes.
Boehner and Obama have been negotiating a deal to raise billions of dollars in new revenues and replace the automatic spending cuts mandated by an earlier deficit-reducing deal that on New Year’s Day will trigger $1.2 trillion in cuts over 10 years.
At the end of the year, the Bush tax cuts expire, as well as a payroll tax holiday that would mean leaner pay checks.
Boehner, who has had trouble quelling his party’s fiscally hawkish Tea Party wing, asserts the path away from the fiscal cliff is through deep spending cuts. Republicans want spending reduced on entitlement programs such as Medicare and Social Security, with Boehner offering proposed cuts of up to $1.4 trillion. He has agreed to $800 billion in new revenues.
But Democrats say Boehner has not specified what he would cut, nor has he said how he would raise the new revenues.
President Obama has proposed raising taxes on the wealthiest 2 percent of Americans, one of several measures that would generate about $1.4 trillion over a decade.
Republicans want any deal to lean more heavily on spending cuts and have pushed the president to come up with a deal that would win support in the Republican-controlled House.
But Democrats accuse Republicans -- and Boehner specifically -- of holding the middle class hostage as a bargaining tool for preserving tax cuts for the wealthy.
“It’s all in their hands,” Senate Majority Leader Harry Reid told reporters. Citing public opinion polls, the Senate’s top Democrat said Boehner would be foolish to ignore public sentiment. “At some point, reality should set in,” Reid said.
Senator Richard Durbin, a Democrat of Illinois, suggesting that Boehner was more concerned about appeasing his party’s fiscal conservatives. “What’s he waiting for? ... Is he waiting for Jan. 3?” referring to House leadership elections.
“I’m not concerned about my job as speaker,” Boehner told reporters.Bobby Caina Calvan can be reached at email@example.com. Follow him on twitter @GlobeCalvan.