WASHINGTON – A top Republican leader emerged from a meeting with the U.S. treasury secretary Thursday and accused Democrats of failing to outline specific cuts to avert deep austerity measures that threaten to send the economy into recession at the start of next year.
“No substantive progress has been made between the White House and the House” in the past two weeks, House Speaker John Boehner told reporters after the private meeting with Tim Geithner. “I was hopeful we’d see a specific plan for cutting spending, and we sought to find out today what the president really is willing to do.”
Boehner spoke by phone with President Barack Obama on Wednesday night, and he said his remarks Thursday were the result of that conversation as well.
Democrats quickly countered. “Republicans know where we stand,” said Senate Majority Leader Harry Reid. “We’re still waiting for a serious offer from Republicans.”
At issue are steep, across-the-board cuts to the Pentagon and domestic programs set to strike the economy in January, as well as the expiration of Bush-era tax cuts on income and investments. That combination would wring more than half a trillion dollars from the economy in the first nine months of next year, according to the Congressional Budget Office.
Those changes will automatically take effect unless the Obama administration and a divided Congress can reach a deal by the end of the year to avoid them.
Many experts worry that allowing the spending cuts and tax increases for even a relatively brief period could rattle financial markets.
Obama insists on extending all expiring tax cuts except for those that apply to incomes over $200,000 for individuals and $250,000 for couples. Boehner and other Republicans say that would harm the economy rather than help it.
Boehner also has said that Republicans are willing to endorse higher tax revenues, but only as part of a deal that includes savings from the most popular government benefit programs.
Obama has been mounting a public campaign to build support in the negotiations, appearing at the White House with middle-class taxpayers and launching a campaign on Twitter to bolster his position.
From their public statements, Obama and Boehner appear at an impasse over raising the two top tax rates from 33 per cent and 35 per cent to 36 per cent and 39.6 per cent. Democrats seem confident that Boehner ultimately will have to crumble, but Obama has a lot at stake as well, including a clear agenda for other priorities like an overhaul of the nation’s immigration laws.
Obama also was meeting privately Thursday with his defeated Republican rival Mitt Romney. The president has cast his re-election as a sign that Americans back his tax proposals, which were a centerpiece of his campaign.