Obama vows to veto fiscal cliff plan
2012-12-19 22:07
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Washington - President Barack Obama on Wednesday warned
Republicans he would veto their "Plan B" plan to avert the looming
fiscal cliff crisis, saying it would dump pain disproportionately on the middle
class.
The move came as hopes faded for an imminent deal to
avert a year-end combination of tax hikes and huge spending cuts which analysts
fear could spark a new US recession and damage the fragile global economic
recovery.
Republican House Speaker John Boehner framed the
legislation, which would raise taxes on those earning more than $1m, in case
his talks with Obama on a broader plan to trim the US deficit do not bear fruit
by the deadline.
His gambit was the latest move in a tense game of brinkmanship
between the Democratic White House and Republican House, which has deep
political ramifications for the balance of power in Washington during Obama's
second term.
White House communications director Dan Pfeiffer said the
Boehner plan meant that the wealthiest Americans would still benefit while
students and families would lose critical tax cuts and health and unemployment
benefits they need.
Back-up plan
Pfeiffer said the plan would also "perversely"
not include spending cuts that Republicans have demanded in talks with Obama.
"This approach does not meet the test of balance,
and the president would veto the legislation in the unlikely event of its
passage."
If Boehner and Obama do not reach a deal before the end
of the year, George W Bush-era tax cuts on all Americans will expire and taxes
will go up.
Obama campaigned on renewing tax cuts for people earning
less than $250 000 but has since moved the threshold in negotiations with
Boehner up to $400 000.
Boehner spokesperson Brendan Buck called what he said was
the White House's opposition to a back-up plan "bizarre and irrational”.
"In the absence of a 'balanced' solution from the
president ... we must act to stop taxes from rising across the board in 12
days," he said.
Earlier this week, hopes were rising for a deal but
Boehner's decision to put a Plan B on the House floor has some observers
wondering whether he can sell a deal with Obama to his own restive caucus.
White House officials privately say that they believe
Obama has made significant compromises in search of a deal with Boehner,
including agreeing to a Republican plan to calculate the impact of inflation on
the Social Security retirement plan, which could slow the growth of benefits.
