Breaking: GOP Rejects Obama's Fiscal Cliff Offer

President Obama has made the first substantial offer in fiscal cliff negotiations, and John Boehner, representing House Republicans, was quick to reject the deal.

The Wall St. Journal reported the bullet point details of the proposal sent by President Obama to Speaker of the House John Boehner. The proposal made a strong move toward a more progressive economic policy, and was rejected quickly by Boehner. The plan presented by Obama broke down as follows:

  • $1.6 trillion over ten years in new taxes on income in excess of $250,000.
  • A one year delay in cuts to defense and entitlement programs, with $400 billion in cuts mainly from health and retirement programs, and smaller cuts to farm subsidies and other programs.
  • An extension of unemployment benefits, and a delay in cuts to physicians through Medicare, and to homeowners whose homes are financially underwater.
  • The ability to raise the debt ceiling without the permission of congress.
  • $50 billion of immediate stimulus on infrastructure projects.

Obama's negotiating tactics have adjusted to his GOP adversaries. In his first term, he would have more concessions built into his first proposal. This time, he asked for just about everything he wanted, and put the ball in the Republican's court to see how they will adjust his offer. A new wrinkle in Obama's proposal is the $50 billion in stimulus money, which would provide a shot of adrenaline to an economy still getting on its feet. The president certainly would love to have that come out of any fiscal cliff deal, but it is probably expendable, unlike the tax cut and the raise in the debt ceiling. 

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