President Obama and top House Republicans are deep in negotiations over a far-reaching plan to save $3 trillion over the next decade through sharp cuts in agency spending and politically painful changes to popular health and retirement programs, but without any immediate increase in taxes, Democratic congressional leaders reported Thursday.
[C]ongressional Democrats were furious over what they described as the latest twist in White House talks, which they said now appeared to taking an unacceptable turn.
[C]ongressional Democrats were in a high state of alarm about talks they said were now leading toward a broad deficit-reduction deal that would not immediately include increased revenue. They said this would violate their pledge not to cut benefits for Social Security and Medicare recipients and require them to swallow a deficit-reduction plan that relies solely on spending cuts without raising taxes. Democrats, including Obama, have repeatedly pledged to pursue a deal that contains a “balance” of both spending cuts and revenue increases.
“There’s no agreement. They’re working toward an agreement,” Reid said, adding that he received a call from a White House official during Thursday’s Democratic meeting that confirmed the president had not reached a final agreement with Boehner. The luncheon meeting included a presentation by White House Budget Director Jacob Lew, who was pilloried by Democrats who contended that Obama was giving away deep cuts to entitlements without any agreement on taxes.
Reid said his caucus would oppose any plan that did not include increased tax revenue, questioning whether Obama had gone back on his pledge to include “balance” in the final deal. When “we hear these reports of these megatrillion-dollar cuts with no revenues, it was like Mount Vesuvius,” said Sen. Barbara Mikulski (D-Md.). “Many of us were volcanic.”
During the luncheon, Lew denied that such a deal was under discussion, several Democrats said. But when Lew was asked to explain the actual outlines of the talks, “that got a little fuzzy,” said Sen. Sheldon Whitehouse (D-R.I.).
Administration officials revealed the substance of the latest White House talks to congressional leaders late Wednesday, after Obama met with Boehner and Cantor, congressional aides said, speaking on condition of anonymity to detail private discussions. The White House acknowledged that the proposed deal is “to the right of the Gang of Six” and far removed from what Democrats have said would be acceptable.
According to congressional sources, Obama has apparently offered to forgo any tax increases in the initial deal, postponing an overhaul of the tax code until next year. That was also the shape of the old deal, but with one significant exception: Obama had been pressing Republicans to extend the Bush-era tax cuts for middle-class households now, allowing the cuts that benefit the wealthiest households to expire next year. If that part of the bargain were taken off the table, the aides said, Democrats would be left with no guarantee that Republicans would actually follow through with tax reform in the future.
