White House Makes New Offer in Talks to Avoid Fiscal Cliff
WASHINGTON — They are getting closer.
The White House presented a new offer to Speaker of the House John Boehner today that makes some important concessions in the talks to work out a deal to avoid the so-called fiscal cliff, a mixture of tax rate hikes and spending cuts that go into effect in January of a deficit reduction agreement is not reached. This White House package comes in response to the offer Boehner made to allow tax rates rise on those making $1 million.
The new offer from the White House includes fewer tax increases and more limits on the entitlement spending (including limits on cost of living adjustments for Social Security recipients) than the President’s previous offers.
Speaker of the House John Boehner will present this latest White House offer to House Republicans tomorrow morning. Here are some of the key concessions:
- Instead of $1.6 trillion tax increases, the White House is now offering $1.2 trillion
- The Bush tax cuts would be extended for everybody earning under $400,000 (the previous White House offer was $250,000)
- The formula used to calculate cost of living increases will be adjusted, resulting in lower annual increases for Social Security recipients (liberals will hate this). The neediest seniors, however, will still see their cost of living increases adjusted according to the old formula.
- All-told, the offer includes 1.22 trillion in spending cuts.
- A two year extension of the debt ceiling (the President had been asking for a permanent extension).
The reaction from the speaker of the House to this offer is quite a contrast to his reactions to previous White House offers.
Instead of denouncing it as not being serious, Boehner spokesman Michael Steel calls the offer “a step in the right direction” but still not “balanced.” He also sees the numbers a little differently.
“Any movement away from the unrealistic offers the president has made previously is a step in the right direction, but a proposal that includes $1.3 trillion in revenue for only $930 billion in spending cuts cannot be considered balanced,” Steel said. “We hope to continue discussions with the president so we can reach an agreement that is truly balanced and begins to solve our spending problem.”
In other words, this won’t be the deal, but it is considerably closer than where we were last week.

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Any deal that does not make a serious dent in the national debt is a sell out of the nation by politicians and should not be supported by the citizens,.
Posted by: Girish | December 18, 2012, 6:28 am 6:28 am
Can I ask why Congress (or anyone for that matter) thinks Social Security and Medicare are an entitlement? If I look at my pay stub I see money taken out of my pay EVERY pay period for both of these. Where does the entitlement factor play into this? I’m sick to death of having lies told so many times that hopefully the public starts believing this garbage.
Lets get to the real fact of the matter. Most of Congress MAKES more than $250,000 a year so I’m sure that is why this number causes dissension concerning paying more taxes.
Until our government quits being self serving and starts doing the job they were ELECTED to do by their constituents, our country will continue to be in peril. Start working together for the good of ALL not just the 1%. Its disgusting and disheartening to say the least.
Posted by: Vicki Smith-Drysdale | December 18, 2012, 7:51 am 7:51 am
Obama wimping-out?
Posted by: Randall | December 18, 2012, 8:29 am 8:29 am
Interesting that you don’t include obama’s increased spending in this report. It is part of the deal that is being negotiated. These increased spending requests will increase the deficit and the debt. Do you not consider them pertinent to the story?
Posted by: Perplexed | December 18, 2012, 9:05 am 9:05 am
What is wrong with these Republicans thinking that Social Security and Medicare should be touched? There is no way that Social Security and Medicare should be in the cuts! The Republican party is so far out of reality in their beliefs to make the old people lose their sense of dignity. Cost of living increases are very important to stay up with property taxes, utility increases and care for the property! They are bullies and this is the reason to vote them out of office. The White House campaigned on not touching Social Security and Medicare! This is a travesty.
We paid in with the idea that we were going to have a retirement. We cannot buy Grandchildren Christmas gifts!
Posted by: ElderlyAmerican | December 18, 2012, 9:11 am 9:11 am
ElderlyAmerican | December 18, 2012, 9:11 am — Quit whining! SS and Medicare have IOU’s in the accounts and they are in need of an overhaul. I guess we can simply let them run out of money and go from there (sarcasm).
Posted by: Commonsenseparty | December 18, 2012, 9:37 am 9:37 am
I am writing concerning the fiscal cliff. We pay for the Senators, Representitives. The should not be entitiled to leave for the holidays. Us hard workers get maybe 1 day off for the holidays, if we are lucky. You are not entitled to have days off. You want to rush this bill thru just to have these days off. Then the hard workers making under $100,000.00 get the bull crap. Having hard times paying bills with high cost of living, higher insurance premium.
Posted by: Sally m. Rosario | December 18, 2012, 9:39 am 9:39 am
NOTHING is on the table that will save SS, Medicare or Medicaid from inevitable BANKRUPTCY within a few years. We know what the problem is but ignore it. What will eventually happen is that we no longer will be able to borrow the 42 cents on the dollar that we spend and will have no money to pay existing benefits. People know this and realize it but just choose to ignore it. In just 14 years the expenditures for these entitlements and the service on the debt will make up 100% of our budget. No money for defense or anything else. You asked for it and you are going to get it.
Posted by: Perplexed | December 18, 2012, 9:45 am 9:45 am
These negotiations between Boehner and the President are an exercise in futility. The President, Harry Reid and Nancy Pelosi can deliver the democrats but Boehner is not strong enough to force any compromise from the tea party republicans.
Posted by: tmferretti | December 18, 2012, 9:50 am 9:50 am
Why are we raising the debt again? It has to go to the other way. Raising it negates the whole point. That’s not cutting spending, that’s raising spending.
Posted by: TexBork_2012 | December 18, 2012, 9:53 am 9:53 am
This White House “Compromise” sure sounds like I hear the Can being Kicked Down the Road.
We need significant cuts, 4 cut dollars to 1 new revenue dollar.
That would be “balanced” considering the spending is so out of whack.
The two year debt extension is something they threw in so that they can then say we gave up something in the end. No one is taking that seriously and Boehner ought to ignore it as if it wasn’t in the list at all.
Silly Obama.
Posted by: Noz | December 18, 2012, 9:59 am 9:59 am
TMFERRETTI…I disagree. When you get ‘too many cooks’ in there…you always spoil the soup. I always thought that the $250k level was a ‘bottom negotiating position’. And if it would be more in the range of one half million…it takes a ‘lot of the wind’ out of small businessmen’s sails. People who have been making a lot of ‘noise’ at the State and local levels.
Posted by: CND FOX | December 18, 2012, 10:05 am 10:05 am
“Why are we raising the debt again? It has to go to the other way. Raising it negates the whole point.” – TexBork_2012
Nothing says I (prezzie O’Bama) want to continue deficit spending unabated like asking for a two year extension of the debt ceiling without congressional approval.
Bwaaaa ha ha ha
Silly President NoBo.
Fiscal responsibility is beyond his capabilities.
Posted by: Noz | December 18, 2012, 10:07 am 10:07 am
I miss Ron Paul. That man actually knows how bad debt is for our country. Raising the debt ceiling is the worst possible idea. That condones the idiotic levels of spending. Stay strong, Boehner.
Posted by: Nick | December 18, 2012, 10:09 am 10:09 am
They limit SS cost of living increaes as they vote themselves a raise for the outstanding job performance they have dsiplayed over the last 4 years. Congress and the President don’t give a darn about us. SS and Medicare taxes must increase to keep them viable and the govt needs to keep its greedy paws out of the Social Security piggy bank. They are all hypocrits and when the country fails and riots start in the streets – they and the people that continually vote these idiots into office will find out the hard way as will we.
Posted by: Cynic | December 18, 2012, 10:12 am 10:12 am
TEX
I agree, what’s the point? We aren’t going over the cliff because of the deficit, were going over the cliff because of the spending cuts. These spending cuts will lower the deficit for about two weeks, until all those millions of laid off workers are removed from the tax rolls and require assistance. Then the deficit will go up again.
The quickest and best way to lower the deficit is to get this economy moving again: we’re going to have to spend money to save money.
Posted by: tmferretti | December 18, 2012, 10:16 am 10:16 am
The President’s offers have been anything, but realistic. He wants to spend more money without effectively reducing out deficit or debt and raise the debt ceiling. Until all politicians get real about not raising the debt ceiling thereby forcing our govt to live within its means – nothing will change. Demcorats will pontificate how they are for the middle class when the very programs and spending they enact make things worse over time and the Republicans will continue to cave in allowing it to happen thereby ensuring they will have something to whine about on the Democrats. Unfortunately, the GOP is the only party espousing realistic fical policy while the Dems continue their typical sell their tax and spend ideas to the simple and get re-elected.
Posted by: Cynic | December 18, 2012, 10:18 am 10:18 am
Posted by: Cynic | December 18, 2012, 10:18 AM 10:18 AM
B I N G O !
Let me add, if the Repubs cave on this and kick the can down the road then I say the Tea Party Members should abstain from confirming Boehner and instead vote for Pelosi because, what would be the difference at that point?
Posted by: Noz | December 18, 2012, 10:32 am 10:32 am
tmferretti wrote: “”"”"we’re going to have to spend money to save money.”"”"” Let’s put that phrase to a common sense test! Does that work in your household? We tried a stimulus and it didn’t stimulate. The Keynesian Theory is simply spend and try to outlast the economic downturn. It doesn’t get to the root problem like housing, jobs and uncertainty. If a deal is made, that will help fix the uncertainty and some of the jobs issues. The housing issue is a serious problem because of the amount of money within our housing sector. HARP 1 and 2 didn’t fix many upside homeowners who continue to pay their mortgages eventhough the banks have caused such damage to housing prices. Those people continu to pay top dollar for homes that are worth 50% of what they were worth. Banks should be FORCED to refinance at the lowest rate and current prices which would allow those consumers to put their money into the economy instead of paying for an overpriced house.
Posted by: Commonsenseparty | December 18, 2012, 10:36 am 10:36 am
Does anyone else notice that all the details are coming from the White House? From John Boehner all we get are vague statements and posturing. It’s very clear that President Obama is willing to compromise, but this should be the final offer. If Republicans don’t want to compromise then let’s go over the cliff. I’m ready to stop consuming for a while. The economy will just have to suck it.
Posted by: Eric | December 18, 2012, 10:54 am 10:54 am
COMMONSENSEPARTY
It works very well in any household. I haven’t done it, but spending money on solar panels will save you money in the long run. Spending money to fix leaking pipes will save you money. Spending money to buy a fuel efficient car will save you money. etc, etc
For our government, spending money to put people back to work and stimulate this economy will save us trillions.
By the way, the first stimulus did exactly what it was supposed to; keep our unemployment rate below 20%
Posted by: tmferretti | December 18, 2012, 10:56 am 10:56 am
tmferretti | December 18, 2012, 10:56 am —- Actually, the stimulus was supposed to give tax breaks and create “shovel ready” jobs and also create millions of jobs. The problem is throwing money at a problem doesn’t fix it. You have to put the money in the areas that need it most. After TARP, stimulus, QE 1, 2, 3 and Operation Twist, Obama has barely netted 500,000 jobs in 4 years. If Bush’s 3 million in 8 years was so hotly attacked by people like you, then Obama’s spending to create a mere 500,000 jobs in 4 years should really have you upset. I don’t know of any households that were at their credit limit (or even close to it) and spent their way out of it. You must live in a different part of the US I have not heard about.
Posted by: Commonsenseparty | December 18, 2012, 11:19 am 11:19 am
@ Perplexed. Americans don’t believe Tea Party ideology. The protocol is obsolete.
Posted by: V | December 18, 2012, 11:36 am 11:36 am
V: Let’s see if you are singing that arrogant tune when the inevitable happens and we go broke. It is easy to be cavalier now because you have not felt the consequences. However, one has a different perspective when you have to eat crow.
Posted by: Perplexed | December 18, 2012, 11:44 am 11:44 am
@ TMFERRETTI. Are you serious with that last argument about the government spending? Your line of thought has no base in logic. What does me having a plumber fix my pipes have to do with the government spending money it does not have? Do you propose that the government go out and buy a new fleet of fuel effecient cars in order to recoup the cost in gas 5 years from now? Try again.
Posted by: ignorant | December 18, 2012, 11:50 am 11:50 am
COMMONSENSEPARTY
If I remember correctly, while driving across country 4 years ago there was a sign every ten miles on the interstates saying “Your Stimulus Money At work. All along that stretch of highway were hundreds of construction workers who weren’t at home collecting unemployment but were working.
TARP was necessary to keep the financial markets from collapsing and creating a worldwide depression. Both President Bush and President elect Obama agreed on TARP. Now the treasury has sold that stock they got from AGI and we’ve made a 17 billion dollar profit. It sounds to me that both Presidents knew what they were doing.
In four years we’ve gained over 4 million jobs not the 500,000 you say. No matter, I’ll take the 500,000 anytime over the 750,000 we were losing a month at the beginning of the Obama administration.
Posted by: tmferretti | December 18, 2012, 11:51 am 11:51 am
IGNORANT
I was answering COMMONSENSE’S analogy to household spending.
You missed the whole point. I’m saying in order to put America back to work , this government is going to have to spend money, that money will be recouped in a larger tax base, more sales taxes and reduced unemployment benefits being paid out.
Posted by: tmferretti | December 18, 2012, 11:56 am 11:56 am
tmferetti: Those construction workers were here today and gone tomorrow when the government money ran out. They were not in permanent positions. That is the problem when government ‘invests’ as opposed to private sector investing. The private sector’s investment results in expansion of the economy and creation of permanent jobs. The government’s ‘investment’ only lasts until the funny money runs out. Then they are back to the ranks of the unemployed.
Posted by: Perplexed | December 18, 2012, 12:03 pm 12:03 pm
PERPLEXED
Your right, it creates temporary jobs but those jobs snowball into permanent jobs. It also helped fix a deteriorating infrastructure that leads to faster more efficient transportation and even more jobs.
The government never envisioned these jobs would be permanent, that’s why it is called a stimulus, to stimulate hiring not have the government pay these people forever.
Take high speed rail for example, once the government gets things moving, private contractors would take over the construction, hundreds of thousands of jobs would be needed to maintain and administer that system.
Think of stimulus as seed money that is used to get the economy moving and people working plus fix and improve our infrastructure.
The TVA (Tennessee Valley Authority) is a prime example. It put thousands to work, thousands who are still employed and electrified the South at the same time.
Posted by: tmferretti | December 18, 2012, 12:18 pm 12:18 pm
PERPLEXED
The private sector is not going to invest until they have a viable affluent market place. That won’t happen if we keep putting people out of work. Companies don’t hire to create business , they hire to maintain that busness and meet demand.
Posted by: tmferretti | December 18, 2012, 12:49 pm 12:49 pm
“Let’s see if you are singing that arrogant tune when the inevitable happens and we go broke.”
Perplexed, from 1946 to 1973 the U.S. national debt went DOWN from 109% of GDP (it is about 65% today) to 24%. Taxes were higher on the highest earners back then. We did not “go broke”.
How did they fix it? Not severe cuts. Instead, we GREW THE GDP by investing in American jobs.
I agree with V. Take a look at how well stringent austerity has failed EU economies. Right Wing fears about cuts only, less taxes, and no investment in our country’s manufacturing are out of date in the post-Recession world.
Posted by: green.goddess | December 18, 2012, 12:59 pm 12:59 pm
What about Obama’s inability to be fiscally responsible?
Posted by: Noz | December 18, 2012, 1:10 pm 1:10 pm
The whole philosophy of trickledown is bogus. The economy grows from the middle outward not from top to bottom. Trickledown should have had its last gasp after it caused the great depression but the republicans are so beholding to the wealthy and corporations (at the expense of their own class) they can’t see this.
They even went so far as to revive it during the Bush administration with the same result.
Posted by: tmferretti | December 18, 2012, 1:22 pm 1:22 pm
“What about Obama’s inability to be fiscally responsible?”
Does the definition of “fiscally responsible” include building our GDP to reduce the national debt?
The Tea Party / Libertarian notion that our nation should place total faith the Free Market’s invisible will – mixed with government imposed austerity – has been a failure in the EU.
Americans are pioneers and entrepreneurs. We reject government mandated austerity without a mix of opportunity as “fiscal responsibility”. We reject the Libertarian concept of investment in jobs and manufacturing as wasteful. We reject the idea that a higher power wills little children to suffer.
Posted by: green.goddess | December 18, 2012, 1:27 pm 1:27 pm
It’s really pretty ‘simple folks’….but all of us get distracted wilth ‘the white noise’ of the narrative controlled by the ‘wealthy of this country’. All we have to do to ‘reinvest in our country’s infrastructure’ – which will get middle class people working again – is this. Change the ‘tax structure laws so that the wealthiest corporations and individuals can’t ‘hide’ or renvest their money in overseas ventures’ without assuming a higher tax rate for that ‘maneuver’. This is what we need to reduce our deficit, more than anything. Look at what they have ‘done’ with thier ‘disingenuous narrative’…they have got middle class people ‘fighting each other’. While the ‘tax laws’ allow them to pile up wealth. Time to WAKE UP….folks.
Posted by: CND FOX | December 18, 2012, 1:29 pm 1:29 pm
CND FOX
You got it, take this assault weapon issue, it’s not about the 2nd amendment, safety of our citizens, the death of 20 children, common sense or anything similar.
It’s about the billions the gun manufacturers make in selling these needless weapons to private citizens. They own the NRA and enough politicians in Congress that no solution will ever be found. The republicans seem to be the most susceptible to their subtle brainwashing.
Posted by: tmferretti | December 18, 2012, 2:04 pm 2:04 pm
This proposal is BULLCRAP! Obama needs to stop the spending, stop the spending, STOP THE SICK, SICK SPENDING! DO NOT give him ANY extension on the debt ceiling, Boehner! It’s like letting an alcoholic have the keys to a liquor store so that he can continue his out of control spree while the country continues to tank. DO NOT ACCEPT THIS PROPOSAL, BOEHNER. Just continue to hang tough, REAL TOUGH. Do not fall for the crap from the wannabee dictator and his prep school, crew cut WEASEL Carney.
Posted by: Francis | December 20, 2012, 6:42 pm 6:42 pm