After talking to Speaker John A. Boehner and Senate Majority Leader Harry Reid, President Barack Obama said Friday that he still hopes to avert an income tax increase on 98 percent of Americans before Dec. 31. Then the White House promptly announced the president would be leaving Friday evening for Hawaii, where he will spend Christmas with his family.
“Call me a hopeless optimist,” Obama told reporters at the White House about the fiscal cliff. And in a sign that he still believes he will have something to negotiate, Obama ended his statement by saying he’d be cutting his Hawaii trip short. “Because we didn’t get this done, I will see you next week,” he said.
Indeed, both Obama and Reid indicated that they were willing to scale back their expectations for what a fiscal cliff deal might entail when talks resume next week.
Shortly before taking the podium, Obama met with the Nevada Democart at the White House. The duo apparently talked about a “fallback” plan that would extend tax cuts for middle-income taxpayers, as well as unemployment insurance.
A Reid aide said the majority leader agrees with Obama’s position that Republicans should continue negotiating with Democrats on a deal that would avert tax increases on all Americans and automatic, across-the-board spending cuts that are set to take effect in January.
“As a fallback plan to protect the middle class, Republicans should support passing a bill that extends tax cuts for families up to $250,000, extends unemployment insurance and delays the so-called sequester while we negotiate additional policies next year,” the Reid aide said. “But the bottom line is that moving forward on any solution will require cooperation from Speaker Boehner and Senator [Mitch] McConnell. We hope they will return from Christmas ready to cooperate.”
That statement represents a slight shift for Reid, who has repeatedly said he does not want to pass any legislation that just pushes more substantial action on the fiscal cliff to next year. Of course, Boehner tried to pass a “plan B” on Thursday, but abruptly pulled the measure for lack of GOP votes.
Brendan Buck, a spokesman for the Ohio Republican, said Boehner would also return to Washington after the holiday hoping to find a deal.
“Though the President has failed to offer any solution that passes the test of balance, we remain hopeful he is finally ready to get serious about averting the fiscal cliff,” Buck said. “The House has already acted to stop all of the looming tax hikes and replace the automatic defense cuts. It is time for the Democratic-run Senate to act, and that is what the Speaker told the President tonight.”
The president said he believes a deal can be negotiated and passed in the next 10 days that, at a minimum, would do what all parties say they want to do: avoid a tax increase on the middle class. Obama also wants the legislation to extend unemployment benefits and set the stage for deficit and jobs legislation next year.
“All of us, every single one of us, agrees that tax rates shouldn’t go up for the other 98 percent of Americans,” he said. “There is absolutely no reason — none — not to protect these Americans from a tax hike.”
Lois Lerner, director of exempt organizations for the IRS, arrives for a House Oversight and Government Reform Committee hearing on the investigation of the IRS' targeting of political groups. Lerner invoked her Fifth Amendment right to not testify and caused a protest from some committee members when she offered an opening statement and engaged in dialogue with members before invoking the right.
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