RENEE MONTAGNE, HOST:
A high stakes negotiation that got underway two weeks ago on a congenial note has turned acrimonious. We're talking about the effort by the White House and Congress to avoid those automatic tax hikes and sweeping spending cuts that kick in on January 1st. The top two Republicans on Capitol Hill are flatly rejecting what the White House proposed to them yesterday. NPR's David Welna has the story.
DAVID WELNA, BYLINE: As talks began to skirt a fiscal cliff, President Obama took pains to make nice with Republicans, but it's Mr. Nice Guy no more. First came a reportedly tense half-hour phone conversation Wednesday evening between the president and House Speaker John Boehner. It was followed yesterday by a series of meetings at the Capitol, where Treasury Secretary Tim Geithner and White House congressional point-man Rob Nabors huddled behind closed doors with top congressional leaders.
Straight from his meeting with them, Boehner clearly was not pleased.
REPRESENTATIVE JOHN BOEHNER: It was frank, and it was direct. I was hopeful we'd see a specific plan for cutting spending. We sought to find out today what the president really is willing to do.
WELNA: Senate Republican Mitch McConnell called yesterday's talks a step backward, saying they moved, quote, "away from consensus and significantly closer to the cliff." A congressional Republican aide familiar with the White House proposal called it a complete break from reality. Boehner said there's been no substantive progress since the fiscal cliff talks began.
BOEHNER: I got to tell you, I'm disappointed in where we are, and disappointed in what's happened over the last couple of weeks.
WELNA: According both to White House and GOP sources, President Obama wants Congress initially to come up with $1.6 trillion in new tax revenues, extend the soon-to-expire 2 percent payroll tax cut, delay the automatic spending cuts known as sequestration for a year, renew long-term emergency unemployment insurance and do a long-term stimulus package worth $50 billion next year alone. That's matched with an offer of $400 billion in spending cuts.
But it was the president's insistence on raising the debt ceiling as part of a deal that drew fighting words from Boehner. He said he'll keep insisting on equal spending cuts for every dollar that the ceiling is raised.
BOEHNER: As I told the president a couple weeks ago, there's a lot of things I've wanted in my life, but almost all of them had a price tag attached to them.
WELNA: That prompted a scolding from White House spokesman Jay Carney.
JAY CARNEY: Asking for a - that a political price be paid in order for Congress to do its job to insure that the United States of America pays its bills and does not default for the first time in its history is deeply irresponsible.
WELNA: Carney continued in that vein, laying out Mr. Obama's bottom-line in this post-election test of wills.
CARNEY: The president will not sign any legislation that extends the Bush-era tax cuts for the top - for top earners in this country. This should not be news to anyone on Capitol Hill. It is certainly not news to anyone in America who was not in a coma during the campaign season.
WELNA: Back at the Capitol, Senator Majority Leader Harry Reid said Republicans need to spell out just what they mean when they say they're willing to consider new revenues as part of a deal.
SENATOR HARRY REID: Really, now is the time for the Republicans to move past this happy talk about revenues - ill-defined, of course - and put specifics on the table. The president has made his proposal. We need a proposal from them.
WELNA: Democrats are clearly emboldened after winning more seats in both chambers of Congress and getting the president reelected. New York's Charles Schumer, the Senate's third-ranking Democrat, says Republicans should see the handwriting on the wall.
SENATOR CHARLES SCHUMER: The election said raise the top rates on the highest income people, and our democracy still works well enough that they're going to have no choice but to go along with that.
WELNA: Indeed, Senior House Republican Tom Cole of Oklahoma says it would be smart for his fellow Republicans to approve a Senate bill that spares 98 percent of taxpayers from seeing a hike in their taxes January 1st.
REPRESENTATIVE TOM COLE: If it extends them for just about everybody and makes them permanent, then that's certainly what I'm trying to achieve.
WELNA: Senate Democratic Leader Reid, for his part, says it won't be his party that drives the nation over the fiscal cliff.
REID: If it happens, it'll be under the leadership of the Speaker of the House of Representatives, John Boehner.
WELNA: Which may be why Democrats are confident they now have the upper hand in this showdown. David Welna, NPR News, the Capitol. Transcript provided by NPR, Copyright NPR.