WASHINGTON – House Speaker John A. Boehner made an opening offer Wednesday to avert an impending fiscal showdown, softening his party’s confrontational tone one day after its electoral losses. But he stood by the GOP’s core no-new-taxes pledge that has prevented a deal with the White House.
The Ohio Republican shunned the bombastic approach favored by his tea party wing and sought to portray his House majority as ready to work with Obama when Congress returns for what is expected to be an intense lame-duck session.
Lawmakers and the White House are racing to strike a year-end deal that would prevent automatic tax increases and spending cuts, the so-called “fiscal cliff” that economists warn could throw the economy into another recession.
“Let’s rise above the dysfunction and do the right thing together for our country in a bipartisan way,” Boehner said at the Capitol.
Democrats welcomed the conciliatory overture but panned its substance, particularly the tax-cut proposals echoing those Mitt Romney advocated in his failed presidential bid. Nonpartisan experts have said the proposals do not add up.
“The election’s over,” and Americans are tired of gridlock, Senate Majority Leader Harry Reid of Nevada said. “They want a balanced approach to everything, but especially the situation we have dealing with this huge deficit, and taxes.”
As the White House and congressional leaders took stock of the post-election landscape, Obama called congressional leaders from both parties for what will likely be the first of many private conversations about the daunting fiscal challenge awaiting them.
“The president said he believed that the American people sent a message in Tuesday’s election that leaders in both parties need to … put the interests of the American people and the American economy first,” the White House said in a statement.
Democrats want Obama to swiftly unveil a proposal to resolve the fiscal mess, believing his victory provides a unique mandate to steer negotiations.
They expect him to make the case to the American public, which polls have shown largely prefers the Democratic approach — a balance of tax increases on wealthier households and spending reductions.
By getting out front on the issue, Boehner not only opened the door for the president but challenged him to make the next move. Boehner suggested a stopgap measure that would buy time for negotiations to continue in 2013 on a broader deal to reform the tax code and entitlement spending — the so-called grand bargain.
Boehner’s proposal would extend current tax rates for another year for all Americans, including the well-to-do. The rates established during the George W. Bush administration are set to expire Dec. 31. Obama has vowed to veto any proposal that preserves the lower rates on income above $250,000 for couples and $200,000 for singles.
The rates had been due to expire in 2010 but were extended in a lame-duck session two years ago. Obama wants the top income tax rate to rise from 35 percent to 39.6 percent, the rate in effect during President Bill Clinton’s term.
Boehner also proposed temporarily halting automatic budget cuts across military and domestic programs that both sides accepted last year when they agreed to raise the debt ceiling — how much the nation can borrow — but now want to undo.
The speaker’s proposal would buy time while negotiations continue on cleaning up the tax code, changing federal spending on Medicare, Medicaid and other entitlements, and reducing overall federal spending.
But the substance of Boehner’s proposed tax overhaul relies on economic growth to produce revenue, as Romney’s did.