|STEVEN R. HURST, Associated Press|
The Obama administration quickly rejected the plan, which was sent to the
Obama and congressional Republicans have until
Economists predict that a failure to avoid both the rise in taxes and the mandated spending cuts would send the fragile economy back into recession and cause a spike in already stubbornly high unemployment.
The Republican plan calls for increasing the eligibility age for
It does not, however, meet Obama's demand that tax rates be raised for American couples earning more than
Adding to the negative consequences of a negotiated outcome is the coincidence of the end to two other programs at the same time — a reduction in the payroll tax that Americans pay into the federal
The Boehner offer is in response to Obama's offer last week to hike taxes by
The Republican plan also proposes to raise
Boehner said the proposal is a "credible plan" for Obama and that he hopes the administration would "respond in a timely and responsible way." The offer comes after the administration urged Republicans to detail their proposal to cut popular benefits programs like
"After the election I offered to speed this up by putting revenue on the table and unfortunately the
The Boehner proposal revives a host of ideas from failed talks with Obama in the summer of 2011. Then, Obama was willing to discuss a so-called grand bargain, including politically controversial ideas like raising the eligibility age for
The clock is ticking closer to the end-of-year deadline to avert the fiscal cliff, which is a combination of the expiration of Bush-era tax cuts and automatic, across-the-board spending cuts that are the result of prior failures of
Last week, the
In exchange, the president would back
Republicans said they responded in closed-door meetings with laughter and disbelief.
The Republican plan is certain to whip up opposition from Democrats opposed to any action now on
Both ideas were part of negotiations between Boehner and Obama in the summer of last year.
Earlier Monday, Obama answered questions on Twitter for an hour as the
In response to a question about his insistence on higher tax rates for the wealthiest earners, Obama said that "high end tax cuts do (the) least for economic growth & cost almost $1T." By contrast, he said, "extending middle class cuts boosts consumer demand & growth."
Obama said he was open to "smart cuts" in spending, but not in areas like research and development and education, which "help growth & jobs." He also said he opposes spending cuts that would hurt the disabled or other vulnerable groups.
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