The White House Wednesday threatened to veto a plan put forward by leading House Republicans aimed at delaying the onset of the 'fiscal cliff.'
The plan, called 'Plan B,' was presented by House Speaker John Boehner, R-Ohio, as a stopgap measure in negotiations with the White House and Congressional Democrats to avoid a series of automatic tax increases and spending cuts scheduled to take effect at the end of the year.
Boehner's Plan B would extend tax cuts for people making up to $1 million. Earlier this week President Barack Obama said he would be willing to extend the cuts to those making no more than $400,000.
Senate Majority Leader Harry Reid, D-Nev., had already said Monday that Boehner's plan could not pass the Senate, and on Tuesday the White House weighed in with a statement from Communications Director Dan Pfeiffer.
"The American people have been clear that they will not accept an economic approach that places too big of a burden on the middle class, seniors, students and the most vulnerable Americans while asking too little of the wealthiest Americans," Pfeiffer said in a written statement.
Boehner's Plan B would extend large tax cuts for the wealthiest Americans, Pfeiffer said, while eliminating tax breaks for students, families and businesses.
"It would also cut off a vital lifeline of unemployment assistance to 2 million Americans fighting to find a job just a few days after Christmas, while deeply cutting Medicare," Pfeiffer said. "The deficit reduction is minimal, and perversely, given its authors, solely through tax increases with no spending cuts."
He added, "This approach does not meet the test of balance, and the President would veto the legislation in the unlikely event of its passage."
Pfeiffer said that President Barack Obama is still seeking "a significant, balanced deal that is good for American families, the economy and for our nation's future" and has put forward a proposal that offers to meet Boehner halfway on taxes and spending.
"The President urges the Republican leadership to work with us to resolve remaining differences and find a reasonable solution to this situation today instead of engaging in political exercises that increase the possibility that taxes go up on every American," he said. "The American people are watching closely and deserve no less."
According to a White House analysis of the 'Plan B,' Boehner's proposal would only raise roughly a third of the $1 trillion in tax increases from high-income households that had previously been proposed by the Speaker.
Furthermore, according to the analysis, Boehner's plan would give tax cuts to households earning more than $1 million per year a $50,000 tax break while also setting estate tax rates that would cost the government roughly $120 billion by not taxing estates worth more than $7 million.
At the same time, the analysis concludes, Boehner's proposal would not extend tax credits for working families or those providing incentives for businesses to invest in research and development or in clean energy initiatives.
It would also cut off unemployment benefits for 2 million Americans in January, the White House said.
"At Christmas time, Plan B would cut off benefits for 2 million workers searching for jobs, something Congress has never done before when unemployment was still 7.7 percent," the analysis said.
Under the Republican proposal, doctors treating Medicare patients could also see a 27 percent cut in reimbursement rates, jeopardizing care for 50 million people with Medicare, the White House said.
by RTT Staff Writer
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