WASHINGTON — The first cracks are developing among Republicans over whether to accept a quick deal with President Barack Obama on allowing the top two income tax rates to expire, even as an administration official said the White House was stepping up behind-the-scenes negotiations.
Conservative Oklahoma GOP Rep. Tom Cole told GOP colleagues in a private meeting Tuesday that it's better to make sure that tax cuts for the 98 percent of taxpayers who make less than $200,000 or $250,000 a year are extended than to battle it out with Obama and risk increasing taxes on everyone.
Cole's remarks are noteworthy because he's a longtime GOP loyalist and a confidant of House Speaker John Boehner, R-Ohio. They were made in a meeting of the House GOP Republican whip team, which is a sounding board for GOP leaders.
If we don't believe taxes should go up on anybody, why can't we accept a deal that takes 98 percent out and still leaves us free to fight on the other grounds, Cole said in an interview on Wednesday. I'm not for using the American people for leverage or as a hostage.
Meanwhile, it was announced that two of Obama's chief negotiators will meet on Thursday with congressional leaders to gauge prospects for a deal. Treasury Secretary Timothy Geithner and White House legislative chief Rob Nabors will meet separately with Boehner, Senate Republican leader Mitch McConnell of Kentucky, Senate Majority Leader Harry Reid, D-Nev., and House Democratic leader Nancy Pelosi of California.
The sessions are seen as an important step in determining how the government will avoid a year-end package of tax increases and spending cuts that could throw the economy into recession.
Some Republicans on the Hill have been worried that the GOP would lose a bargaining advantage by separating tax cuts for the highest earners from everyone else, but Cole said he believes the reverse is true. I think we have the winning argument, he said. Most Americans intuitively understand that raising taxes on small business is costing them jobs.
Cole's comments drew a rebuke from Boehner, who is standing firm against Obama's demand that tax rates go up for top earners.
He's a wonderful friend of mine and a great supporter of mine, but raising taxes on the so-called top 2 percent — half of those taxpayers are small business owners, Boehner said. You're not going to grow the economy if you raise the top two rates. It'll hurt small business. It'll hurt our economy.
Reaction was mixed to his idea at a Wednesday morning meeting of House Republicans, Cole said. Conservative Rep. Raul Labrador, R-Idaho, who said he opposed Cole's idea, said he believed a majority of House Republicans also opposed it.
Cole said he expects to support whatever deficit-cutting deal Boehner is eventually able to negotiate with the White House as the two sides wrangle over how to avoid the fiscal cliff mix of tax increases and spending cuts that will occur automatically in January unless lawmakers avert them.
This is a tactical argument, this is not a theological argument, Cole said.