WASHINGTON — Republican House Speaker John Boehner said Sunday that talks to resolve the dreaded “fiscal cliff” are going “nowhere,” as Democrats demand a tax hike for the richest Americans.
Without a deal by year’s end, a poison pill of tax hikes and massive spending cuts, including slashes to the military, comes into effect with potentially catastrophic consequences for the fragile US economy.
But budget negotiations go right to the heart of ideological differences between Democrats and Republicans on the size and scope of government, and the biggest sticking point has clearly been on tax rates for high-income earners.
Speaking on “Fox News Sunday,” Boehner said he was “flabbergasted” when tough talking Treasury Secretary Timothy Geithner, President Barack Obama’s pointman for the talks, presented the White House’s proposal.
“I looked (at) him and said, ‘You can’t be serious,'” Boehner recounted, saying three of the seven weeks available had “been wasted with this nonsense.”
“Right now, I would say — we’re nowhere, period. We’re nowhere” toward reaching a compromise, he added.
Boehner accused the White House of asking for more revenue from tax hikes than Obama has acknowledged publicly and of including new stimulus spending that would exceed the amount of new budget cuts.
The Republican leader said Republicans have shown they are willing to deal, in offers to raise more revenue from wealthy Americans by closing tax loopholes and limiting deductions.
His party insists that raising the tax rate itself would be counter-productive, hurt small business owners, slow economic growth and dampen job creation.
But Geithner, who made the rounds of the Sunday television talkshows, said there would be no deal unless Republicans allowed tax rates on the wealthiest Americans to rise.
The year-end deadline is the result of legislation passed when Republicans and Democrats failed to reach a previous long-term deficit and budget deal, and was meant to concentrate minds of lawmakers and spur compromise.
The parties are also feuding about where to cut expenditures, with some Republicans opposed to any trimming of the military budget and Democrats guarding social safety net entitlement programs.