Debt-reduction negotiations between President Obama and House Speaker John A. Boehner collapsed Friday, derailing an effort to reach a landmark agreement to cut spending, overhaul the tax code and avert a government default.
In subsequent statements, both sides blamed the other for an impasse that threatens to plunge the nation into a fiscal crisis if the government fails to meet a looming deadline to raise the federal debt ceiling.
President Obama announced Friday that House Speaker John Boehner called off deficit reduction talks despite having a fair deal on the table.
The ‘fiscal cliff’ tax fights you haven’t heard about
“It’s hard to understand why Speaker Boehner would walk away from this kind of deal,” Obama said, but Boehner (R-Ohio) countered that it was the president who walked away from an agreement on revenue increases.
“The White House moved the goal posts,” Boehner said in a press conference, demanding “more money at the last minute — and the only way to get that extra revenue was to raise taxes.”
“The vast majority of the American people believe we should have a balanced approach” between revenues and cuts, Obama told reporters. He added that he had been willing to agree to a deal that was more generous to Republican interests than to those of his fellow Democrats.
Saying that “we have now run out of time,” Obama summoned Boehner, House Minority Leader Nancy Pelosi (D-Calif.), Senate Majority Leader Harry M. Reid (D-Nev.) and Senate Minority Leader Mitch McConnell (R-Ky.) to the White House at 11 a.m. Saturday.
“They’re going to have to explain to me how it is that we are going to avoid a default,” he said. He later said he was confident that a default could be avoided.
Boehner agreed with that last point at least, saying, “No one wants to default on the full faith and credit of the United States government, and I am convinced that we will not.” He added later, “We can work together here on Capitol Hill to forge an agreement, and I’m hopeful the president will work with us.”
Boehner and Obama had been negotiating over what the speaker called a “big deal” to try to save between $3 trillion and $4 trillion in the federal budget.
Obama told reporters Friday evening that he had offered Boehner more than $1 trillion in cuts to discretionary spending — both domestic and defense — and $650 billion in cuts to entitlement programs such as Medicare, Medicaid and Social Security. He said he had sought revenues that were less than those put forward in a bipartisan plan by the Senate’s “Gang of Six.” He said the $1.2 trillion in revenues could be accomplished without raising tax rates but by eliminating loopholes, tax breaks and deductions.
“This was an extraordinarily fair deal,” Obama said. “If it was unbalanced, it was unbalanced in the direction of not enough revenue.”
Now that he has “been left at the altar a couple of times,” Obama said, the question for the Republicans is, “Can they say yes to the anything?”
About an hour later, Boehner told reporters that the two sides had agreed to $800 billion in additional revenues, but when the White House then demanded another $400 billion through tax increases, the Republican leader walked away.
“It’s not in the best interest of our country to raise taxes during this difficult economy,” Boehner said.
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