House GOP Puts ‘Cliff’ Bid on Table
House GOP leaders endorsed a debt-reduction plan yesterday that would raise tax collections by $800 billion over the next decade, but they refused to budge on higher tax rates for the wealthy, the central issue dividing Republicans and Democrats.
In making a counteroffer to President Obama, House Speaker John Boehner, a Republican from Ohio, and other senior Republicans suggested that a framework laid out by Democrat Erskine Bowles last year could serve as a starting point for talks aimed at averting the year-end “fiscal cliff.”
That framework aims to raise new revenue through an overhaul of the tax code. It also calls for slicing $600 billion from federal health programs, in part by increasing the Medicare eligibility age from 65 to 67, and saving $200 billion by applying a less generous measure of inflation to all federal programs, including Social Security benefits, according to GOP aides.
For the first time, Boehner managed to get his entire leadership team – including conservative champions such as House Majority Leader Eric Cantor of Virginia and House Budget Committee Chairman Paul Ryan of Wisconsin, the 2012 vice-presidential candidate – to publicly sign on to a plan that explicitly calls for new tax revenue.
Republicans say they are willing to extract all the new tax money from households earning more than $250,000 a year, the same group Obama wants to target with higher tax rates. But the GOP plan raises the money by wiping out deductions instead of raising rates.
In a meeting with reporters, Boehner called it “a credible plan that deserves serious consideration by the White House.”
But Democrats said the proposed cuts to social safety-net programs would outweigh higher taxes. And they said Republicans had yet to make clear how they would raise the additional tax revenue without imposing new burdens on the middle class.
“The Republican letter released today does not meet the test of balance. In fact, it actually promises to lower rates for the wealthy and sticks the middle class with the bill,” White House communications director Dan Pfeiffer said in a statement.