‘Negotiating Leverage’
“Unlike last year, Democrats now have all the negotiating leverage, and Republican hostage-taking threatens not just the economy, but the future of the Republican Party,” Richard Trumka, president of the AFL-CIO who attended a fiscal cliff meeting at the White House last month, said in a Nov. 30 statement. Republicans “are still insisting on the very things voters rejected so resoundingly: tax cuts for the wealthiest two percent and benefit cuts to Social Security, Medicare and Medicaid.”
The administration has rejected Republican complaints that it’s not offering enough specifics.
The White House is proposing spending cuts of about $2.4 trillion. That consists of $1 trillion in cuts already enacted last year, $350 billion in health-care savings, $250 billion on non-health programs, such as farm subsidies, and $800 billion as war costs are pared.
The administration proposes $1.6 trillion in tax increases, with about $866 billion of that from allowing income-tax and estate tax cuts expire for the wealthiest 2 percent of Americans. Obama also proposes about $200 billion in “economic growth” incentives, including stimulus programs, subsidies for mortgages deemed underwater and and extension of the 50 percent bonus depreciation.
Business Leaders
Besides campaigning outside Washington, Obama has been selling his stance at the White House. Over the last several weeks, he has hosted groups of business leaders, assuring them that he’ll accept entitlement cuts if he can win his push for higher tax rates on wealthy individuals like themselves.
Republicans, who won another two years in control of the House, are warning Obama that he’s not the only one to have re- election on his side, and say he’s overplaying his hand.
Representative Pat Tiberi, an Ohio Republican and a member of the tax-writing Ways and Means Committee, said he is frustrated at Obama’s approach.
“Clearly, the president won 50 states and 75 percent of the vote,” he said. “That’s what they’re acting like.”