Treasury Secretary Timothy Geithner, President Barack Obama’s point man on the fiscal cliff negotiations, presented Republican leaders a proposal to avoid the fiscal cliff on Thursday, which gives Obama unprecedented powers to raise the debt ceiling whenever he wants.
The White House proposal includes $1.6 trillion in tax increases, a one-year deferral of sequestration, and $400 billion in savings from Medicare and other programs.
In addition, the White House’s initial offer also gives Obama the authority to raise the debt ceiling essentially to infinity without congressional approval and a “multi-year” stimulus package that would be “at least” $50 billion for fiscal year 2013.
Republican aides have noted that the White House’s proposal already breaks Obama’s campaign promise of taking a “balanced” approach to the fiscal cliff negotiations. His plan contains four times as much increased tax collection ($1.6 trillion) as spending cuts ($400 billion). Further, the White House proposal includes a new round of multi-year stimulus programs that would be “at least” $50 billion for fiscal year 2013, which, over time, would more than offset the $400 billion in claimed initial savings.
The Democrat-controlled Senate could only find 51 votes to “pass a bill with $800 billion in new tax revenue a few months ago,” casting doubt on whether Obama’s current proposal would pass.
House Speaker John Boehner, after seeing the White House’s plan, said, “no substantive progress has been made in the talks between the White House and the House over the last two weeks.” Senate Majority Leader Sen. Harry Reid (D-NV) said he did not “understand” Boehner’s “brain.”