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| President Barack Obama waves to reporters as he steps off the Marine One helicopter and walks on the South Lawn at the White House in Washington, Thursday, Dec. 27, 2012, as he returns early from his Hawaii vacation for meetings on the fiscal cliff. |
WASHINGTON
(AP) -- President Barack Obama returned to the White House on Thursday
from a vacation shortened by government gridlock while congressional
Democrats and Republicans snarled across a partisan divide without
evidence of compromise on a year-end "fiscal cliff" that threatened
across-the-board tax increases and cuts to government programs.
Adding
to the woes confronting the middle class was a pending spike of
$2-per-gallon or more in milk prices if lawmakers failed to pass farm
legislation by year's end.
White House aides
disputed reports that Obama was sending lawmakers a scaled-down plan to
avoid the "fiscal cliff," and gave no indication whether he would invite
congressional leaders to a White House meeting either later Thursday or
possibly on Friday.
A little more than four
days from the deadline, there was no legislation pending in either the
House or the Senate to stave off tax increases and spending cuts that
economists say could send the economy into a
recession. Far from
conciliatory, the rhetoric was confrontational and at times unusually
personal.
Senate Majority Leader Harry Reid,
D-Nev., accused House Speaker John Boehner of running a
dictatorship,
citing his refusal to call a vote on legislation to keep taxes steady
for most while letting them rise at upper incomes. The bill "would pass
overwhelmingly," Reid predicted, and said the Ohio Republican won't
change his mind because he fears it might cost him re-election as
speaker when the new Congress convenes next week.
Boehner
seems "to care more about keeping his speakership than keeping the
nation on a firm financial footing," he said in remarks on the Senate
floor.
Brendan Buck, a spokesman for Boehner,
responded in a similar vein. "Harry Reid should talk less and legislate
more if he wants to avert the fiscal cliff. The House has already passed
legislation to do so," he said, referring to a measure that extends
existing cuts at all income levels.
Addressing
the GOP rank and file by conference call, Boehner said the next move is
up to the Senate, which has yet to act on House-passed bills to retain
expiring tax cuts at all income levels as well as replace
across-the-board spending cuts with targeted savings aimed largely at
social programs.
"The House will take this
action on whatever the Senate can pass - but the Senate must act," he
said, according to a participant in the call.
At the same time, Boehner told Republican lawmakers the House would convene on Sunday evening.
The
risk of higher milk prices stems from the possibility that existing
farm programs will expire at year's end, and neither chamber of Congress
has scheduled a vote on even a temporary extension to prevent a spike.
There have been unverified estimates that the cost to consumers of a
gallon of milk could double without action by Congress.
The president flew home from Hawaii overnight after speaking with top congressional leaders.
Before
leaving the White House last Friday, the president had called on
lawmakers to pass scaled-down legislation that prevents tax increases
for the middle class, raises rates at upper incomes and renews expiring
unemployment benefits for the long-term jobless. He said he still
supports a more sweeping measure to include spending cuts to reduce
deficits, but said they could wait until the new year.
That
capped an unpredictable week in which Boehner pivoted away from
comprehensive deficit reduction talks with Obama to an aborted attempt
to push legislation through the House that retained existing tax levels
except above $1 million. Anti-tax Republicans rebelled at raising rates
on million-dollar earners, and Boehner backpedaled and canceled the
planned vote.
Without congressional action,
current tax rates will expire on Dec. 31, resulting in a $536 billion
tax increase over a decade that would touch nearly all Americans. In
addition, the military and other federal departments would have to begin
absorbing about $110 billion in spending cuts.
Failure
to avoid the "fiscal cliff" doesn't necessarily mean tax increases and
spending cuts would become permanent, since the new Congress could pass
legislation cancelling them retroactively after it begins its work next
year.
But gridlock through the end of the year
would mark a sour beginning to a two-year extension of divided
government that resulted from last month's elections in which Obama won
a new term and Republicans retained their majority in the House.
The
tax issue in particular has been Obama's first test of muscle after his
re-election in November. He ran for a new term calling for higher taxes
on the wealthy, and postelection public polls show continued support
for his position.
Boehner's decision to
support higher rates on million-dollar earners marked a significant
break with long-standing GOP orthodoxy, but the resistance among his
rank and file so far has trumped him as well as any mandate the
president claims.
