Obama and Boehner meet again to avert fiscal cliff

Susan Davis, USA TODAY | USATODAY

WASHINGTON — President Obama and House Speaker John Boehner met privately Thursday after another day of back-and-forth over tax hikes, spending cuts and efforts to avoid the year-end "fiscal cliff."

Hours earlier, Boehner said that unless Obama makes further concessions on spending cuts, Washington will head over the cliff and into a series of tax hikes and massive budget reductions.

"The president wants to pretend spending isn't the problem. That's why we don't have an agreement," said Boehner, R-Ohio. "Unfortunately, the White House is so unserious about cutting spending that it appears willing to slow-walk our economy right up to -- and over -- the fiscal cliff."

Meanwhile, a group of Democrats sent Obama a letter warning him against accepting Republican proposals to reduce entitlement programs, including an increase in the Medicare eligibility age.

After their 50-minute meeting at the White House, aides to Obama and Boehner sent out similar statements saying they would not detail the discussions, but the "lines of communication remain open."

Just 18 days remain for Washington to take action before the George W. Bush-era tax cuts expire, and $1.2 trillion in spending cuts over 10 years are triggered. Several other laws are expiring that also affect millions of Americans, including a temporary payroll tax holiday and long-term unemployment benefits.

Boehner: Obama ignoring spending in 'cliff' deal Speaker of the House John Boehner says one reason there's no deal to avoid the fiscal cliff is that President Barack Obama has not offered enough spending cuts. (Dec. 13)

Obama called negotiations "still a work in progress," as he answered a question shouted to him as he left the White House for a holiday party for employees at the nearby Blair House early Thursday afternoon. White House spokesman Jay Carney said Republicans have been more "rhetorical" than specific in their revenue and spending proposals. "There is no specificity behind what the Republicans have put forward," he said, describing the GOP plan as "fantasy economics."

Carney added, "We still believe a big deal is possible."

Obama and Boehner, the chief negotiators, remain far apart on an agreement. Obama is seeking $1.4 trillion in revenue in his latest offer, which includes raising the individual tax rates on the top 2%. Boehner opposes the tax hike, and wants to overhaul the tax code instead to generate more revenue. Republicans also want more spending cuts -- particularly in entitlement programs like Medicare -- which Democrats are unwilling to cede.

"Don't even think about raising the Medicare age," warned Minority Leader Nancy Pelosi, D-Calif., "We have clarity on that." Senate Majority Whip Richard Durbin, D-Ill., echoed Pelosi, telling reporters that he's received assurances from the White House that raising the Medicare eligibility age is "no longer one of the items being considered by the White House."

Pelosi said if there's any chance of reaching a deal before Christmas, an agreement would need to be reached by early next week. There is no indication Obama and Boehner are near an accord to meet that deadline. The speaker has advised lawmakers that Congress could be in session the week between Christmas and New Year's Day, leading right up to the "fiscal cliff" deadline.

Pelosi: Let's engineer deal on fiscal cliff House Minority Leader Nancy Pelosi says with 12 days until Christmas, Congress should spend more time working on a deal to avoid the possible fiscal cliff. (Dec. 13)

Financial markets have remained stable during the negotiations because there is still confidence a deal will be reached, Pelosi said. "So far they trust that we would not be so stupid to go over a cliff."

Boehner has been non-committal about whether or not he would bring a bill to the House floor to extend the current tax rates for 98% of Americans, which the Democratic-Senate has already passed. It is one option to address the "fiscal cliff" if a broader deal cannot be reached. He said only that a full expiration of the tax rates "remains a risk."

He also reiterated that Republicans will not support an effort by the president to remove the need for congressional approval to raise the debt ceiling, the nation's borrowing authority, which is scheduled to hit its $16.4 trillion limit in mid-February.

"Congress is never going to give up our ability to control the purse," he said, "The fact is, the debt limit ought to be used to bring fiscal sanity to Washington D.C."

Contributing: Associated Press