Thursday, April 17, 2014
FAIRFIELD-SUISUN, CALIFORNIA
99 CENTS

AP sources: New Obama offer moves toward Boehner

WASHINGTON — President Barack Obama has agreed to curtail future cost-of-living increases for recipients of Social Security and softened his demand for higher taxes at upper income levels as part of accelerating talks with House Speaker John Boehner to avoid a “fiscal cliff,” people familiar with the talks said Monday.

Speaking a few hours after Obama and Boehner met at the White House, these people said the president was now seeking a higher tax rate beginning at incomes over $400,000, up from the levels of $200,000 for individuals and $250,000 for couples that were cornerstones of his successful campaign for re-election.

Obama’s willingness to reduce future cost-of-living increases in Social Security, government retirement and numerous other programs marked another clear a concession to Boehner, although it came with an asterisk. The president wants lower-income recipients to receive protection against any loss from scaling back future cost of living increases, these officials said.

Nor did Obama’s offer include raising the age of Medicare eligibility from 65 to 67, a Republican goal that has drawn particularly strong objections from Democratic liberals.

Several officials also said during the day that Boehner’s offer late last week to accept higher tax rates included provisions that would mean higher taxes on investment income and dividends earned by wealthy Americans and also in the estate tax.

The people who described the talks did so on condition of anonymity, citing the secretive nature of the discussions.

The maneuvering is aimed at reaching an agreement that would include cancellation of a scheduled year-end hike in taxes for nearly all wage-earners as well as spending cuts at the Pentagon and in domestic programs across the government.

Economists inside and outside the government have warned that the combination of the two, set to begin at year’s end, could send the economy into recession.

Other major issues are part of the negotiations. Without action by Congress, for example, long-term unemployment benefits will expire for millions at the end of the year, and doctors will face a cut in the payments they receive for treating Medicare patients.

Obama has also called for assistance for hard-pressed homeowners as well as fresh economic stimulus measures, and some Democrats want to include a sizeable amount of disaster aid in any legislation to offset the cost of Superstorm Sandy.

On other points, Obama’s latest offer dropped his earlier proposal to extend a payroll tax cut due to expire at year’s end, and he agreed to find more savings in government spending than in his earlier offer.

The new offer that was given to Boehner at the White House closed the gap between the two men considerably on a framework for a deal.

At the same time, with rank and file conservatives distressed about over higher taxes, aides to the Ohio Republican were quick to find fault with Obama’s latest offer.

Brendan Buck, a spokesman, said that “a proposal that includes $1.3 trillion in revenue for only $930 billion in spending cuts cannot be considered balanced. We hope to continue discussions with the president so we can reach an agreement that is truly balanced and begins to solve out spending problems.”

Earlier, at the White House, spokesman Jay Carney sidestepped when asked about curbing cost-of-living increases for benefit programs. The president “is prepared to make tough choices. He also understands that his bill will not, as written, likely be what the final compromise, if there is one, looks like,” he said.

“But he insists and will insist before he signed anything that there is the balance that he seeks that is fair and that seniors aren’t bearing the burden so that the healthy bear less — those who can afford it most bear less.”

A spokesman for Boehner declined comment on the tax proposals.

Obama and Treasury Secretary Tim Geithner met with Boehner and his top aides at the White House for less than an hour during the day. While neither side provided significant details, Republicans have made it clear in recent days that it is the president’s turn to propose savings from Medicare and other benefit program following Boehner’s agreement last week to let tax rates rise at incomes higher than $1 million.

Officials familiar with the talks said that under the Ohio Republican’s proposal, the top tax rate on capital gains would go to 20 percent, up from the current 15 percent. The top rate on dividends also would climb, although it was not known what the new level would be, and the estate tax would also be adjusted to produce more government revenue.

Under current law, the top capital gains tax rate would rise to 20 percent automatically at the end of the year if the cuts enacted during George W. Bush’s White House tenure were allowed to expire.

The tax on dividends would also rise. The estate tax would be 55 percent on estates after allowance for a $1 million exemption.

As the talks progress, Republicans across the party’s spectrum are eager to turn public attention toward spending cuts, rather than remain bogged down in a politically debilitating debate about tax increases.

“Our problem isn’t that we tax too little. It’s that we spend too much! We must have serious spending cuts for a debt ceiling increase,” tweeted Rep. Tom Price., R-Ga.

That was a reference to the third ingredient under negotiation as part of deal to prevent the economy from reaching the fiscal cliff — an increase in the government’s borrowing authority.

After a brush with the first-ever default by the Treasury in 2011, Obama is demanding that any fiscal cliff compromise give him authority to raise the current $16.4 trillion cap without a prior vote by Congress. Officials say that Boehner’s most recent proposal would grant an increase equal to the size of any spending cuts, roughly $1 trillion under his own recommendations.

The speaker made his offer to Obama late last week, dropping his blanket opposition to the president’s call for an increase in the tax rate paid on upper incomes. Obama’s agreement to reduce his demand so it would affect incomes over $400,000 left the two sides closer, but short of agreement.

As part of the change, Obama is now seeking $1.2 trillion in additional revenue, down from $1.4 trillion that was in an offer he made several days ago.

Officials have said Boehner offered a total of $1 trillion in higher revenue, less than half of which would come this year, and the balance in 2013 as part of a bill to overhaul the tax code.

Some of the increased revenue to be provided immediately would come from setting the tax rate on income over $1 million at 39.5 percent, up from the current 35 percent. The balance would come from higher taxes on capital gains, dividends and other provisions.

The proposal to scale back cost-of-living increases is a regular at deficit reduction talks.

Obama tentatively agreed to back it more than a year ago in talks with Boehner that eventually collapsed, although he sought steps to shelter the lowest-income beneficiaries from its effects.

Democrats have said they would object much more strongly if the president would to accept a plan to raise the Medicare eligibility age from 65 to 67. He was ready to embrace that proposal in the earlier round of talks, but he would face opposition from congressional Democrats and the AARP as well as other groups in the current political climate.

The new inflation adjustment would create government savings of an estimated $168 billion over a decade, according to a recent estimate by the Congressional Budget Office. It also would raise tax revenue by $54 billion by affecting the adjustment in income tax brackets that occurs annually to take inflation into account, CBO said.

The Associated Press

The Associated Press

LEAVE A COMMENT

Discussion | No comments

The Daily Republic does not necessarily condone the comments here, nor does it review every post. Read our full policy

.

Solano News

Supervisor candidates square off at forum

By Barry Eberling | From Page: A1, 7 Comments | Gallery

 
Carli takes oath, now Vacaville’s 14th police chief

By Susan Winlow | From Page: A1 | Gallery

 
Huge jump in Solano median home price

By Brad Stanhope | From Page: A1, 5 Comments | Gallery

Donate a car, help build a house

By Amy Maginnis-Honey | From Page: A3

 
Solano DA hosts workshop to fight human trafficking

By Ian Thompson | From Page: A3, 4 Comments | Gallery

 
 
Fairfield town hall on crime delayed

By Ryan McCarthy | From Page: A4, 5 Comments

Railway museum offers wine-tasting rides

By Adrienne Harris | From Page: A4

 
 
Drugs topic of cardiac class

By Adrienne Harris | From Page: A4

Weather for April 17, 2014

By Daily Republic | From Page: B12

 
Fairfield police log: April 15, 2014

By Susan Hiland | From Page: A12

Suisun City police log: April 15, 2014

By Susan Hiland | From Page: A12

 
Fairfield police log: April 14, 2014

By Susan Hiland | From Page: A12

Suisun Police log: April 14, 2014

By Susan Hiland | From Page: A12

 
.

US / World

Armed robber was never told to report to prison

By The Associated Press | From Page: A1

 
Body of California man who jumped into river found

By The Associated Press | From Page: A4

Lost sea lion in California found mile from water

By The Associated Press | From Page: A4

 
Seabird from Atlantic spotted on Alcatraz

By The Associated Press | From Page: A5

Ex-Bell city leader gets 12 years in prison

By The Associated Press | From Page: A5, 1 Comment

 
California delays decision on protecting gray wolf

By The Associated Press | From Page: A5

Court rules for environmentalists in water fight

By The Associated Press | From Page: A5

 
Governor calls special session on rainy day fund

By The Associated Press | From Page: A5, 1 Comment

Denver police eye 911 response time after killing

By The Associated Press | From Page: A10, 1 Comment

 
Man charged with marathon hoax is held on bail

By The Associated Press | From Page: A10

Geneva talks on Ukraine face steep hurdles

By The Associated Press | From Page: A10

 
Pro-Russian insurgents seize armored vehicles

By The Associated Press | From Page: A10

Ferry sinks off South Korea; 6 dead, 290 missing

By The Associated Press | From Page: A10

 
NATO ups military presence amid Russian threat

By The Associated Press | From Page: A10, 1 Comment

.

Opinion

In support of Pam Bertani

By Letter to the Editor | From Page: A11, 7 Comments

 
Parenting demands responsibility

By Ruben Navarrette | From Page: A11, 2 Comments

 
Let’s stop Fairfield’s future thugs

By Kelvin Wade | From Page: A11, 8 Comments

Obamacare news you probably missed

By Martin Schram | From Page: A11, 2 Comments

 
Editorial Cartoons for April 17, 2014

By Kim Durbin | From Page: A11

.

Living

A lesson in household budgeting

By Chris Erskine | From Page: A2

 
Today in History for April 17, 2014

By The Associated Press | From Page: A2

Community Calendar: April 17, 2014

By Susan Hiland | From Page: A2

 
Horoscopes for April 17, 2014

By Holiday Mathis | From Page: A9

 
.

Entertainment

TVGrid

By Daily Republic Syndicated Content | From Page: B4

 
Daniel Radcliffe on why New York audiences rock

By The Associated Press | From Page: A7

Alicia Silverstone out with book ‘Kind Mama’

By The Associated Press | From Page: A7

 
Jenny McCarthy announces engagement on ‘The View’

By The Associated Press | From Page: A7

Ailing Malcolm Young taking break from AC/DC

By The Associated Press | From Page: A7

 
Disney Channel’s ‘Jessie’ breaks romantic ground

By The Associated Press | From Page: A7

.

Sports

Vacaville’s Peralta to wrestle at San Francisco State

By Daily Republic staff | From Page: B1

 
Angels beat A’s 5-4 on Iannetta’s HR in 12th

By The Associated Press | From Page: B1 | Gallery

MEL, SCAC tangle in hoops all-star games

By Paul Farmer | From Page: B1

 
Sharks take goalie questions into rematch vs Kings

By The Associated Press | From Page: B1

 
Crawford’s 41 points leads Warriors over Nuggets

By The Associated Press | From Page: B1 | Gallery

IndyCar driver Saavedra fined $10K

By The Associated Press | From Page: B2

 
Sandoval’s single lifts Giants past Dodgers, 2-1

By The Associated Press | From Page: B2 | Gallery

Officer: Sharper’s DNA found on 1 Arizona victim

By The Associated Press | From Page: B2

 
Jets sign former Titans RB Chris Johnson

By The Associated Press | From Page: B2

Spieth ready for more after Masters success

By The Associated Press | From Page: B2

 
Backup QB Matt Flynn returns to Packers

By The Associated Press | From Page: B2

Atlanta lands MLS expansion team for 2017

By The Associated Press | From Page: B2

 
Bucks owner Herb Kohl reaches deal to sell team

By The Associated Press | From Page: B2

Sidney Rice agrees to terms with Seahawks

By The Associated Press | From Page: B2

 
Goodwin helps Suns to 104-99 win over Kings in finale

By The Associated Press | From Page: B2 | Gallery

 
.

Business

Yellen: Fed stimulus still needed for job market

By The Associated Press | From Page: B4

 
Some exempted from minimum wage, increased or not

By The Associated Press | From Page: B4

Fed survey: Growth picks up across most of US

By The Associated Press | From Page: B5

 
Bank of America posts loss, hurt by legal charges

By The Associated Press | From Page: B5

IBM posts lower 1Q earnings amid hardware slump

By The Associated Press | From Page: B5

 
Google’s 1Q earnings disappoint as ad prices slip

By The Associated Press | From Page: B5

.

Obituaries

.

Comics

Sally Forth

By Daily Republic Syndicated Content | From Page: A8

 
Peanuts

By Daily Republic Syndicated Content | From Page: A8

Wizard of Id

By Daily Republic Syndicated Content | From Page: A8

 
Beetle Bailey

By Daily Republic Syndicated Content | From Page: A8

For Better or Worse

By Daily Republic Syndicated Content | From Page: A8

 
Zits

By Daily Republic Syndicated Content | From Page: A8

Blondie

By Daily Republic Syndicated Content | From Page: A8

 
Get Fuzzy

By Daily Republic Syndicated Content | From Page: A8

Baldo

By Daily Republic Syndicated Content | From Page: A8

 
Dilbert

By Daily Republic Syndicated Content | From Page: A8

Frank and Ernest

By Daily Republic Syndicated Content | From Page: A8

 
Garfield

By Daily Republic Syndicated Content | From Page: A8

Rose is Rose

By Daily Republic Syndicated Content | From Page: A8

 
B.C.

By Daily Republic Syndicated Content | From Page: A8

Baby Blues

By Daily Republic Syndicated Content | From Page: A8

 
Pickles

By Daily Republic Syndicated Content | From Page: A8

Crossword

By Daily Republic Syndicated Content | From Page: A9

 
Sudoku

By Daily Republic Syndicated Content | From Page: A9

Word Sleuth

By Daily Republic Syndicated Content | From Page: A9

 
Cryptoquote

By Daily Republic Syndicated Content | From Page: A9

Bridge

By Daily Republic Syndicated Content | From Page: A9