Geithner: GOP will raise taxes; Boehner: No way

Both sides in the 'fiscal cliff' negotiations hit the Sunday talk shows but neither side was backing away from their positions ... yet.

WASHINGTON – President Barack Obama's top fiscal negotiator pushed Republicans on Sunday to offer specific ideas to cut the deficit, and predicted they would agree to raise tax rates on the rich to obtain a year-end deal to avoid economic doom.

Treasury Secretary Timothy Geithner said it is up to Republicans if the U.S. goes over the "fiscal cliff," a combination of automatic spending cuts and across-the-board tax hikes that could plunge the country into a recession.

"That's a decision that lies in the hands of the Republicans that are now opposing an increase in tax rates" for the wealthiest Americans, a key sticking point in negotiations for a broad deficit-reduction deal, Geithner told "Fox News Sunday."

With polls showing most Americans favor raising tax rates on the wealthy and cracks starting to appear in what had been a solid wall of Republican opposition to such a move, the Obama administration figures it has the upper hand.

But the top U.S. Republican, Speaker of the U.S. House of Representatives John Boehner, stood firm and renewed his stand against increased tax rates.

"Here's the problem," Boehner said in a separate appearance on Fox. "When you go and increase rates, you make it more difficult for our economy to grow."

Besides, Boehner said, if Republicans agreed to give Obama a proposed $1.6 trillion in new tax revenue, "He's going to spend it," not reduce the deficit.

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Boehner also reaffirmed his party's opposition to Congress giving the president sole authority to increase the U.S. debt limit, a power both Democrats and Republicans value.

"Congress is never going to give up this power," Boehner said, explaining it provides lawmakers needed leverage in dealing with the White House.

With the public and financial markets worried about the fiscal cliff, Boehner used the TV appearance to try to soothe concerns.

"I don't want any part of going over the cliff. I'm going to do everything I can to avert that," Boehner said. But he said the two sides remained far apart with the deadline less than a month away, adding "We're nowhere."

He again refused to offer specific deficit reduction proposals, other than to repeat that one option would be to end a number of unspecified tax deductions.

"The president has seen a lot of options from us. There are a lot of them on the table and I'm hopeful that the conversation will continue," Boehner said.

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More talks are expected this week, at least at the staff level. But both sides have said it may be another week or so before negotiations get serious.

A likely scenario is a possible short-term fix that would postpone the deadline for the fiscal cliff for six months to a year.

Geithner's opening offer last week on was raising tax revenues by $1.6 trillion, at least $50 billion in new economic stimulus spending and effectively giving the president the ability to raise the debt limit.

Republicans promptly rejected the offer as unacceptable, even laughable.

"I was just flabbergasted," Boehner said.


The top House Democrat, Nancy Pelosi, renewed her threat to force a vote on a Senate-passed plan to extend tax cuts for the middle class tax-cut if Boehner does not schedule it immediately."

"The clock is ticking and stalemates are a luxury we cannot afford," she said in a written statement after Boehner spoke.

Republican Senator Lindsey Graham, appearing on CBS's "Face the Nation," said what many in his party have predicted: "We're going over the cliff."

Like other Republicans, Graham accused the administration of failing to negotiate in good faith by refusing to offer significant cuts in spending.

The administration insists that Republicans offer their cuts first, particularly since Obama won re-election this month, promising to raise tax rates on the rich.

"It's pretty clear to me they've made a political calculation," Graham said.

"This offer doesn't remotely deal with entitlement reform in a way to save Medicare, Medicaid and Social Security from imminent bankruptcy," Graham said.

In a blitz of TV appearances, Geithner insisted that tax rates on the richest must go up, and dismissed much of the contentious rhetoric from last week as "political theater."

"The only thing standing in the way of (a deal) would be a refusal by Republicans to accept that rates are going to have to go up on the wealthiest Americans. And I don't really see them doing that," Geithner told NBC's "Meet the Press."

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The comments mark the latest round of high-stakes gamesmanship focusing on whether to extend the temporary tax cuts that originated under former President George W. Bush beyond their Dec. 31 expiration date for all taxpayers, as Republicans want, or just for those with incomes under $250,000, as President Barack Obama and his fellow Democrats want.

Republicans, who control the House but are the minority in the Senate, have expressed a willingness to raise revenues by such steps as limiting tax deductions, but most oppose increasing rates.

"There's not going to be an agreement without rates heading up," Geithner said bluntly on CNN's "State of the Union."

The expiration of the Bush-era tax cuts and automatic reductions in government spending set to take hold early next year would suck about $600 billion out of the economy.

(Anna Yukhananov contributed to this report.)