Republican leaders in Congress proposed their first counteroffer to President Obama's plan to avoid the fiscal cliff, the series of automatic tax hikes and budget cuts that go into effect at the end of the year if Washington cannot compromise on a budget plan.
Last week, Obama presented $1.6 billion in new tax hikes on Americans making over $250,000 a year. Republicans were silent for some time, and offered no specific measures to close the budget shortfall or reduce the federal debt.
But on Monday, Republican House Speaker John Boehner called the president's deal a "La-La-Land offer."
"The president is asking for $1.6 trillion worth of new revenue over 10 years, twice as much as he has been asking for in public," Boehner said.
"He has stimulus spending in here that exceeded the amount of new cuts that he was willing to consider. It was not a serious offer."
Congressional Republicans proposed a plan on Monday that would reduce the deficit by $2.2 trillion, mostly through cuts in spending on Medicare, healthcare. They also offered $800 billion in revenue increases through closing tax loopholes. Middle-class families depend on many deductions, like the mortgage tax deduction, the child income tax credit and deductions for charitable giving to non-profit organizations and churches.
The Republican plan did not include any increase in marginal tax rates on wealthy Americans, which is a dealbreaker for the White House.
"While the president is willing to compromise to get a significant, balanced deal and believes that compromise is readily available to Congress, he is not willing to compromise on the principles of fairness and balance that include asking the wealthiest to pay higher rates," said White House communications director Dan Pfeiffer.
"Their plan includes nothing new and provides no details on which deductions they would eliminate, which loopholes they will close or which Medicare savings they would achieve," said Pfeiffer.
Obama seems to be in a stalemate with Congressional Republicans, with neither side willing to give in on tax rates.
At the same time, Republicans are being attacked from the right by Tea Partiers and conservative anti-tax advocates, who view even the relatively meager tax concessions Republicans offered in their plan as nearly blasphemous.
"The President's proposal and Speaker Boehner's counteroffer fail to seriously deal with the reality of the problems facing the nation," said Tim Phillips, president of anti-tax lobbying group Americans for Prosperity.
"Conservatives are looking for a leader to fight against tax increases, to push back against wasteful government spending, and address the fiscal challenges in a bold way. Sadly this plan leaves Conservatives wanting."
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