Published December 20, 2012
As a year-end deadline looms, Republicans in the U.S House of Representatives pushed ahead on Thursday with their own "fiscal cliff" plan in a move that muddles negotiations with the White House to avoid steep tax hikes and spending cuts.
The Republican-led House is aiming to vote on Thursday evening on Speaker John Boehner's "Plan B" to raise taxes only on annual incomes over $1 million, which is aimed at putting pressure on President Barack Obama to offer more concessions.
"While the White House slow-walks us all to the edge of the fiscal cliff, Republicans are once again taking action to protect American families, our economy, and our national security," Boehner's office said.
But Obama has vowed to veto the plan, and a senior Democratic aide said the top Democrat in the Senate, Harry Reid, is likely to ignore it instead of taking it as a base to work out a wider compromise.
"What we are doing today is wasting time, pretending and making political points but not moving the ball forward to get to a compromise," senior Democratic House member Steny Hoyer of Maryland told MSNBC.
Republicans complain that Obama has not done enough to promise spending cuts to rein in the deficit and hope Plan B will force him to offer more. The two sides are also still at odds on taxes. The White House wants taxes to rise on household incomes above $400,000 a year, a concession from Obama's opening proposal for a $250,000 income threshold, while Boehner's plan aims at income over $1 million.
The clock is ticking toward a deadline at the end of the year. Harsh tax hikes and spending cuts will kick in if talks fall apart, likely pushing the U.S. economy into recession.
U.S. stocks opened little changed on Thursday amid uncertainty over the fiscal talks. The Dow Jones industrial average edged up 4.17 points, or 0.03 percent.
It was still unclear if Boehner - often mistrusted by Tea Party members and other fiscal conservatives in his own caucus - could win backing from conservative Republicans for his Plan B.
Boehner and his leadership team are likely to spend the day rounding up support, with votes possible around 7:45 p.m. ET (0045 Friday GMT), according to one Republican aide.
But the aide would not say whether Boehner had lined up enough Republican votes to ensure passage of the bills, which are expected to get few, if any, Democratic votes.
"We feel momentum is on our side," the aide said.
In an eleventh hour effort to avoid a potential defeat at the hands of some of his party members over the tax hike, Boehner added separate legislation with spending cuts in an effort to lure more conservatives that the tax hike was worth a risky vote.
Those spending cuts aim to scrap the approximately $55 billion in defense program cuts scheduled to begin in January and shift the reductions to other domestic programs.
Those include less spending for social safety net benefits like food stamps and Medicaid healthcare for the poor. It also targets some funding for Obama's signature healthcare reform law.
A Boehner defeat would be an embarrassment, which could either force him to offer concessions to Obama, or embolden conservative Republicans to try to take a harder line against the White House.