WASHINGTON — House Republicans put forth a $2.2 trillion fiscal cliff counteroffer to President Barack Obama on Monday, calling for raising the eligibility age for Medicare, lowering cost-of-living hikes for Social Security benefits and bringing in $800 billion in higher tax revenue — but not raising rates for the wealthy.
The White House declared the Republicans still weren't ready to get serious and again vowed tax rate increases will be in any measure Obama signs to prevent the government from the cliff's automatic tax hikes and sharp spending cuts. Administration officials also hardened their insistence that Obama is willing to take the nation over the cliff rather than give in to Republicans and extend the tax cuts for upper-income earners.
With the clock ticking toward the year-end deadline, House Speaker John Boehner, R-Ohio, and other Republicans said they were proposing a reasonable solution for negotiations that Boehner says have been going nowhere. Monday's proposal came in response to Obama's plan last week to raise taxes by $1.6 trillion over the coming decade but largely exempt Medicare and Social Security from budget cuts.
Though the GOP plan proposes to raise $800 billion in higher tax revenue over the same 10 years, it would keep the Bush-era tax cuts — including those for wealthier earners targeted by Obama — in place for now. Dismissing the idea of raising any tax rates, the Republicans said the new revenue would come from closing loopholes and deductions while lowering rates.
The White House complained the latest offer was still short on details about what loopholes would be closed or deductions eliminated, and it insisted that any compromise include higher tax rates for upper-income earners.
The fiscal cliff is a combination of expiring Bush-era tax cuts and automatic, across-the-board spending cuts that are the result of prior failures of Congress and Obama to make a budget deal.