President Barack Obama and House Speaker John Boehner met today at the White House to discuss the dispute over the U.S. budget, representatives of both said.
â€œThis afternoon, the president and Speaker Boehner met at the White House to discuss efforts to resolve the fiscal cliff,â€ Amy Brundage, a White House spokeswoman, and Michael Steel, a spokesman for Boehner, said in identical statements. Both said no details of the conversation would be provided â€œbut the lines of communication remain open.â€
The meeting was the first known face-to-face conversation between the two leaders since Nov. 16, when Boehner and other congressional leaders sat down with Obama at the White House. They have talked on the telephone since then. Obama met with Nancy Pelosi, the House Democratic minority leader, on Dec. 7.
Obama and Boehner, an Ohio Republican, are trying to reach an agreement that would prevent more than $600 billion in spending cuts and tax increases from taking effect in January.
Disputes over tax rates, spending cuts and the debt ceiling are among the barriers to a deal.
House Republicans insist on broadening the tax base to generate revenue rather than raising rates, Representative Kevin McCarthy said earlier today, signaling no softening in the chamberâ€™s standoff with Obama.
Republicans have offered $800 billion in additional revenue over the next decade, achieved in a way that would be less damaging to the economy than higher rates, McCarthy, the third- ranking Republican in the House, said today on NBCâ€™s â€œMeet the Press.â€
â€œThe best way to get that is through closing special loopholes,â€ the California congressman said.
The optimal strategy for Republicans might be to let the tax rates on top earners expire, Senator Bob Corker, a Tennessee Republican, said today on â€œFox News Sunday.â€
â€œThereâ€™s a growing group of folks looking at this and realizing that we donâ€™t have a lot of cards,â€ he said. â€œGo ahead and give the president this 2 percent increase and all of a sudden the shift goes back to entitlements and maybe that puts us in a place where we can do something.â€
If no deal is reached, Republicans will â€œownâ€ the recession that will inevitably follow, Senator Richard Durbin of Illinois, the second-ranking Democrat in the Senate, said while appearing with McCarthy on the NBC program.
Senator Tom Coburn of Oklahoma and Representative Jeb Hensarling of Texas, both Republicans, said on ABCâ€™s â€œThis Week with George Stephanopoulosâ€ that Democrats needed to accept significant changes in entitlement programs.
â€œThis talk of taxes is almost irrelevant to the trillions and trillions of debt,â€ said Hensarling, who will become chairman of the House Financial Services Committee in January.
Durbin said he was open to charging high-income retirees more money for Medicare to help reduce spending. He said he is less willing to consider increasing the eligibility age for Medicare to 67 from 65.
â€œWhat happens to that early retiree?â€ he asked. â€œWhat about that gap in coverage between their workplace and Medicare?â€
Obama, who has called for higher rates on income of individuals above $200,000 and married couples above $250,000, wants $1.6 trillion in additional revenue, double what Republicans have offered. He said in a Bloomberg Television interview Dec. 4 that limits on tax breaks could generate only $300 billion to $400 billion.
Each sideâ€™s argument on tax rates has gaps. Obamaâ€™s own budget calls for more than $750 billion in revenue from top earners without raising rates, and he said last year that achieving $1.2 trillion without higher rates was possible.
Higher rates are necessary, Durbin said.
â€œThe American people spoke on this issue in the election,â€ he said.
Republicans, meanwhile, havenâ€™t specified which tax breaks they would limit. The costliest breaks are among the most popular, such as those for mortgage interest, charitable contributions, capital gains and employer-provided health insurance.
If Congress doesnâ€™t act by the end of the year, income taxes at all levels will go up, and the top tax rate will reach 39.6 percent, up from 35 percent now.
Automatic spending cuts, half in defense programs, will begin taking effect. The Congressional Budget Office estimates that inaction would lead to a recession in the first half of 2013.