WASHINGTON — President Barack Obama on Wednesday accused House Republicans of letting their animosity toward him prevent them from approving a deal to avert the nation’s imminent fiscal crisis, even though the two sides had been close to a compromise days ago.
“They keep on finding ways to say no as opposed tofinding ways to say yes,” Obama said at a midday news conference atthe White House. “I don’t know how much of that just has to do with, you know, it is very hard for them to say yes to me. But, you know, at some point, you know, they’ve got to take me out of it and think about their voters and think about what’s best for the country.”
He even evoked the recent tragedies of HurricaneSandy and the Newtown, Conn., shootings to prod lawmakers to settle for the nation’s benefit.
“When you think about what we’ve gone through over the last couple months - a devastating hurricane, and now one of the worst tragedies in our memory - the country deserves us to be willing to compromise on behalf of the greater good,” Obama said.
Obama and House Speaker John Boehner, R-Ohio, have been negotiating in private to meet an end-of-the-year deadline to prevent automatic tax increases and spending cuts. On Monday, they seemed close to a deal. But talks stalled Tuesday after Boehner introduced a backup plan that would raise taxes only for those who earn more than $1 million a year.
The president threatened to veto the speaker’s so-called Plan B if it arrived on his desk. In a report issued Wednesday, the White House argued that the plan - which does not continue the American Opportunity Tax Credit and improvements to the Child Tax Credit and Earned Income Tax Credit - would raise taxes for about 25 million middle-class households while preserving large tax cuts for millionaires, hurting the unemployed and reducing Medicare.
Referring to Boehner, Obama said, “If you’re making $900,000, somehow he thinks that you can’t afford to pay a little more in taxes.”
“The principle that rates are going to go up, he’s conceded,” the president said. “I’ve said I’m willing to make some cuts. What separates us is probably a few hundred billion dollars. The idea that we would put our economy at risk because he can’t bridgethat gap doesn’t make a lot of sense.”
In response to Obama’s comments, Boehner met with reporters in a hallway outside his Capitol office to complain that the Obama offer “fails to meet the test that the president promised the people: a balanced approach.” He said he hoped the president “will get serious soon” about working with Republicans.
The House is expected today to take up Plan B - legislation to make permanent most of the George W. Bushera tax cuts, except for those affecting millionaires.. The bill is not expected to win Senate approval.
“Tomorrow, the House will pass legislation to make permanent tax relief for every American, 99.8 percent of the American people,” Boehner told reporters. “Then the president will have a decision to make. He can call on Senate Democrats to pass that bill, or he can be responsible for the largest tax increase in American history.”
Then, after 50 seconds, Boehner walked away, without taking questions.
The most important vote tally today will involve how many Republicans go along. Many conservatives remain wary of any tax increase, though Americans for Tax Reform, which has a no-tax pledge, said a vote on the million-dollar tax threshold would not violate its principles. Some still remain opposed.
“We don’t buy into the Washington-speak, suggesting that these are actually tax cuts,” said Andy Roth, vice president for government affairs at the Club for Growth. Lawmakers contend that by extending the Bush-era cuts, they’re cutting taxes that would otherwise go up next year. Roth argues that tax rates are not being cut at all- they would simply remain the same.
Republican leaders hope that if a large majority of their 241-member caucus votes for Plan B, they can show Obama that a chunk of Republicans is willing to vote for higher taxes. The vote also gives them a fallback, a chance to say they were proactive in pushing for ways to avoid the “fiscal cliff.”
Most Democrats are expected to oppose the plan, even though they’ve supported such measures in the recent past.
Obama said he plans to reach out to congressional leaders of both parties in the coming days to “find out what is holding this thing up” after, he said, he met Boehner more than halfway.
“Frankly up until about a couple of days ago, if you looked at it, the Republicans in the House and Speaker Boehner I think were in a position to say: ‘We’ve gotten a fair deal,’” Obama said. “There’s been a lot of posturing up on Capitol Hill instead of just going ahead and getting stuff done. We’ve been wasting a lot of time.”
The two had begun to coalesce around a plan that would raise taxes for households with annual incomes of more than $400,000, cut spending $2.1 billion and apply a less-generous measure of inflation to Social Security and other programs to lower cost-of-living adjustments. But Republicans are skeptical of the White House’s calculations on budget cuts, raising questions about the savings on interest.
“What I’ve said is that in order to arrive at a compromise, I am prepared to do some very tough things, some things that some Democrats don’t want to see and probably there are a few Republicans who don’t want to see, either,” Obama said.
Obama is to leave Friday for Hawaii for the holidays, but he plans to stay in Washington if no deal is reached.
Failure to reach an endof-the-year deadline would mean that $500 billion in tax increases take effect early next year, coupled with $109 billion in spending reductions, the first installment toward $1.2 trillion in cuts over two years.
The two sides disagree, too, over increases in the government’s debt limit, which will soon need to be raised when borrowing reaches the current $16.4 trillion cap.
Also at issue are unemployment benefits, which are to expire for an estimated 2 million out-of-work Americans at year’s end, and the prospect of reduced payments beginning Jan. 1 for doctors who care for Medicare patients.
Meanwhile, the Internal Revenue Service says as many as 100 million U.S. households, or two-thirds of the total, may not be able to file their tax returns until at least late March if Congress doesn’t reach an end-of-year budget agreement.
Steven Miller, the acting IRS commissioner, issuedthe new estimate in a letter Wednesday to congressional tax writers. With less than two weeks left in the year, Congress hasn’t prevented expansion of the alternative minimum tax, or AMT, for 2012. Tax filing is to start in January and run through mid-April.
“It may not be possible even to process some returns that are clearly not subject to or affected by the AMT,” wrote Miller, who had previously said more than 60 million returns could be affected. “Allowing only some taxpayers to file as we reprogram could substantially increase the risk of fraud and error in initial filings as well as create the potential for a large number of amended returns.”
For one thing, 32 million taxpayers collectively would owe $92 billion more in taxes if an alternative-minimumtax patch isn’t enacted. Further, inaction would require the IRS to reprogram andtest its computer systems. Officials must gauge by early January whether Congress is likely to act on the alternative minimum tax, as lawmakers routinely have done in past years.
The alternative minimum tax, a parallel tax system created in 1969 to catch a small number of rich tax dodgers, is to expand to about 32 million households for 2012, up from about 4 million otherwise.
Information for this article was contributed by Anita Kumar and David Lightman of McClatchy Newspapers; by Jackie Calmes of The New York Times; by David Espo, Ben Feller, Andrew Taylor, Jim Kuhnhenn,Andrew Miga and Alan Fram of The Associated Press; and by Richard Rubin and Margaret Collins of Bloomberg News.
Front Section, Pages 1 on 12/20/2012