Boehner caves on taxes
It's only a "partial" cave, in that Boehner agrees that the tax rates should go up on those making more than $1 million rather than $250,000 a year.
But if Boehner caves on taxes, who can believe him when it comes to any other red line Obama will try and force him to cross.
Signaling new movement in "fiscal cliff" talks, House Speaker John Boehner has proposed raising the top rate for earners making more than $1 million, a person familiar with the negotiations said. President Barack Obama, who wants higher top rates for households earning more than $250,000, has not accepted the offer, this person said.
The proposal, however, indicated progress in talks that had appeared stalled. The person would only discuss the plan on the condition of anonymity because of the sensitivity of the negotiations.
As part of a broader budget deal, Boehner is still seeking more spending cuts than Obama has proposed, particularly in mandatory health care spending. Boehner has asked for a long-term increase in eligibility age for Medicare and for lower costs-of-living adjustments for Social Security.
Boehner's tax proposal was first reported by Politico.
A Boehner aide would not comment on the report.
At issue are expiring tax rates that would automatically increase on Jan. 1 for virtually every income tax payer if Congress and the president don't act. Steep budget cuts are also scheduled to kick in, unless Congress and Obama agree to forestall them with other deficit reduction measures.
Obama has insisted on extending current rates for the 98 percent of taxpayers in household that earn less than $250,000. He would let the top two marginal rates increase from 33 percent to 35 percent and from 36 percent to 39.6 percent for those taxpayers making over that threshold.
Until now, Boehner had maintained his opposition to raising any rates. Instead, he had proposed to raise up to $800 billion in tax revenue over 10 years by limiting tax loopholes and deductions as part of a broad tax overhaul.
It's easy to blame Boehner's cave in on his abilities, rather than the hand he has been dealt. But sometimes, even the best poker players get dealt squat in which case they fold and return to fight another day. The GOP will make the debt ceiling issue next month a rallying point for discussions on cutting entitlements and reforming the tax code. The question is: will Obama play? Or will he allow a default and blame it on the GOP?