President Obama made a fresh offer on the fiscal crisis to John Boehner yesterday and while it was rejected, the two sides are now so close together that it is no longer inconceivable that a deal to avert the cliff could be wrapped up by Christmas. The rundown:
- The Obama deal, described by Boehner's office as "a step in the right direction," included a plan to raise $1.2 trillion in taxes and make $1.2 billion in cuts over the next decade while permanently extending the Bush tax cuts on household incomes below $400,000, reports the New York Times. Obama's initial revenue offer was $1.6 trillion, while Boehner's team initially proposed $800 billion.
- The president's proposal was the first time he has given ground on income tax rates and the White House believes that since Obama has met the GOP halfway on revenue and more than halfway on spending cuts, a deal should materialize soon, sources tell Politico. Boehner, however, will have to sell any compromises to Republicans at a crucial House GOP meeting today.
- Lawmakers on both sides say the next few days will be decisive. If Obama and Boehner fail to strike a deal and sell it to their parties, leaders will have to scramble to find a way to lessen the economic pain of $500 billion in tax increases and spending cuts, reports the Washington Post.
- Harry Reid has warned lawmakers that work on a deal might keep them in DC past Christmas, the Hill reports. "If things don’t change, it appears we’ll be coming back the day after Christmas to finish up work on the fiscal cliff and other items," the Senate majority leader said.