US Treasury Secretary Timothy Geithner predicts Republicans have no choice but to accept higher tax rates
10:24AM EST – December.2.2012 – New York — In a blitz of appearances on five Sunday morning talk shows, Geithner insisted that tax rates on the richest needed to go up in order to reach a deal, a step Republicans have so far resisted, and he dismissed much of the contentious rhetoric from last week as “political theater.”
Treasury Secretary Timothy Geithner pressed Republicans to offer a plan to increase revenues and cut government spending, and predicted they would agree to raise tax rates on the wealthiest to secure a deal by year-end to avoid the “fiscal cliff.”
The fiscal negotiations in Washington continue to divide congressional Republicans who now appear in the position of having to agree to some measure of tax increases to generate revenue to reduce the federal deficit.
“The ball really is with them now,” Geithner, one of the White House’s chief negotiators with Capitol Hill, said during appearances on five Sunday talk shows.
US House Speaker John Boehner says, ‘We’re nowhere’ in fiscal cliff talks with Democrats on ‘Fox News Sunday’.
Geithner presented congressional leaders Thursday with Obama’s post election blueprint for averting the combination of hundreds of billions in tax increases and spending cuts that will take effect beginning in January if Washington doesn’t act to stop it.
But House Speaker John Boehner, R-Ohio, dismissed the plan as “not serious,” merely a Democratic wish list that couldn’t pass his chamber.
As outlined by administration officials, the plan calls for nearly $1.6 trillion in new tax revenue over the next decade, while making $600 billion in spending cuts, including $350 billion from Medicare and other health programs. But it also contains $200 billion in new spending on jobless benefits, public works and aid for struggling homeowners — and would make it virtually impossible for Congress to block Obama’s ability to raise the debt ceiling.
“I was just flabbergasted,” Boehner said, describing his meeting with Geithner. “I looked at him and I said, ‘You can’t be serious?” The speaker, noting the short time between the Nov. 6 election and the new year, said time has been lost so far “with this nonsense.”
Republicans must decide on one of two tax issues
As Republicans negotiate with President Obama and other Democrats they must pick one of two options to avert a $500 billion mix of tax increases and severe federal-spending cuts before they kick in Jan. 1.
The first is whether to increase taxes — or at least eliminate some tax loopholes — to generate revenue to trim the deficit. The other is whether to accept the president’s offer to extend Bush-era tax cuts, but only for families earning less than $250,000 annually, which is roughly 98 percent of Americans.
— Speaker John Boehner (@SpeakerBoehner) December 2, 2012
GOP leaders contend letting top-end tax cuts run out would hit small businesses and cost jobs.
The administration has said it is willing to find savings in the Medicare and Medicaid healthcare programs for the elderly and poor, but Geithner reiterated in an interview with ABC’s “This Week” that it would only be open to looking at changes in the Social Security retirement program outside of the context of a fiscal cliff deal.