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WASHINGTON--Bipartisan optimism gave way to a partisan reality on Capitol Hill as congressional leaders acknowledged Thursday that little progress as been made with the White House to reach a deal to avert the "fiscal cliff" coming at year's end when all of the Bush era tax cuts will expire and billions in automatic spending cuts are triggered.
"I've got to tell you that I'm disappointed in where we are and disappointed in what's happened over the last couple of weeks," said House Speaker John Boehner, R-Ohio, who told reporters "no substantive progress has been made in the talks between the White House and the House over the last two weeks."
Boehner, who is leading the negotiations with President Obama, said a brief Wednesday evening conversation with the president and a meeting Thursday with Treasury Secretary Timothy Geithner did little to move the talks forward. "It was frank, and it was direct," Boehner said of his Geithner meeting.
Boehner wants the president to put forward a Democratic plan for spending cuts -- a suggestion that Democrats find ridiculous because Republicans are seeking spending cuts and entitlement changes. Obama has outlined his proposal to raise the individual rates on the top 2% of Americans in order to raise $1 trillion in revenue over the next decade. Democrats counter that the onus is on Republicans to put forward a plan outlining spending cuts.
"You can't start if (Republicans) aren't putting anything on the table. They have put nothing, nothing of specifics on the table," said Sen. Charles Schumer, D-N.Y.
Republicans have said revenues can be on the table in the form of closing loopholes and capping deductions. The GOP plan establishes a framework for a tax overhaul next year, but Obama has made clear that he wants a down payment on revenues in the form of rates before tax cuts expire Dec. 31.
Boehner said he sees no serious effort from the White House to cut spending. "And unless there is, there's a real danger of going off the fiscal cliff," he warned.
Senate Majority Leader Harry Reid, D-Nev., wants Congress to immediately pass an extension of the Bush era tax cuts that affect 98% of American households to assuage concerns that middle-class earners will see a tax hike in their first 2013 paycheck unless Washington acts. "If it happens, it'll be under the leadership of the speaker of the House of Representatives, John Boehner," Reid charged.
Republicans want to couple any revenue raise with spending cuts, but the divide over who should outline the cuts is flaring tempers in Congress. "I don't understand [Boehner's] brain so you should ask him," Reid quipped, when asked on Boehner's position that Democrats need to come up with a spending-cut plan.
Complicating the negotiations is a further disagreement over whether any deal should include an increase in the debt ceiling, which needs congressional approval. The $16.4 trillion borrowing limit is expected to hit in mid-February and Obama wants to head off another painful fight with Congress that threatens to rattle markets.
Boehner continues to maintain his position that any increase in the debt ceiling must be paired dollar-for-dollar with spending cuts. He views those cuts as separate from the spending cuts he is seeking in the fiscal cliff deal. "I continue to believe that any increase in the debt limit has to be accompanied by spending reductions that meet or exceed it," he reiterated Thursday.
Reid made clear that the debt limit had to be part of a fiscal cliff agreement, but there is no consensus on how to solve that dispute, either. "There will be an agreement on the debt ceiling, or there will be no agreement," Reid said.
Susan Davis/ USA Today