Boehner Tax Stance Shows Reluctance to Give In Too Soon

Photographer: Andrew Harrer/Bloomberg

House Speaker John Boehner, after earlier expressing openness to a deal with Obama, has taken a harder public line in recent days, emphasizing “serious differences” that exist between the two sides. Close

House Speaker John Boehner, after earlier expressing openness to a deal with Obama, has... Read More

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Photographer: Andrew Harrer/Bloomberg

House Speaker John Boehner, after earlier expressing openness to a deal with Obama, has taken a harder public line in recent days, emphasizing “serious differences” that exist between the two sides.

House Speaker John Boehner has drawn a rhetorical line against higher tax rates for top earners, even as he negotiates with President Barack Obama, because he can’t be seen as conceding too much too soon.

A slow-walk approach to averting more than $600 billion in tax increases and spending cuts set for January is crucial for Boehner whether the talks succeed, according to Republicans in Congress. If they don’t reach agreement, Boehner will have gathered a coalition of lawmakers he’ll need for a more limited deal. If he succeeds, he’ll have convinced anti-tax Republicans that he fought to extract spending cuts.

Obama and Boehner met at the White House for almost an hour yesterday in their third face-to-face session to discuss averting the so-called fiscal cliff, with no indication the two have narrowed their differences.

Boehner is returning to his home state of Ohio for the weekend and the House isn’t in session today. Both the speaker’s office and the White House say “the lines of communication” between the two leaders remain open. Some Republicans are discussing a smaller deal that would extend tax cuts for middle- income taxpayers and push work on a broader agreement into the New Year.

As the Dec. 31 expiration of Bush-era tax cuts nears, Boehner is maintaining a tough posture, saying the president “isn’t serious” about spending cuts, without ruling out a deal on taxes to shield his party from criticism. Almost half of Republicans now say Obama has an election mandate to raise rates on the rich, according to a Bloomberg National Poll.

‘A Religion’

“The idea of not raising taxes has become sort of a religion for a lot of members of the Republican Party,” Obama said in an interview yesterday with television station WCCO in Minneapolis. “Speaker Boehner has a contentious caucus, as his caucus is tough on him sometimes so he doesn’t want to look like he’s giving in to me somehow because that might hurt him in his own caucus.”

The president’s reluctance to concede on cuts to entitlement programs, such as Social Security and Medicare, is hurting Boehner’s ability to present his conference with a compromise that can muster enough votes to pass, according to Republicans.

“The speaker’s out there at great disadvantage,” said Trent Franks, an Arizona Republican who described himself as one of the “most conservative” House members.

“I need to make sure he has every possible leverage and option and strategic option that he can make,” he said. “So I won’t speak to what I will or won’t vote for.”

‘Kabuki Dance’

Republican Representative Brian Bilbray of California, who didn’t win re-election in November, said it was Obama who turned the talks into a “kabuki dance” because of his unwillingness to outline entitlement benefit cuts.

Boehner, after earlier expressing openness to a deal with Obama, has taken a harder public line in recent days, emphasizing “serious differences” that exist between the two sides. He also has refused to budge on the White House’s demand that Congress surrender its authority over the government’s borrowing limit as part of any deal.

“Congress will never give up our ability to control the purse,” he said yesterday. “The fact is that the debt limit ought to be used to bring fiscal sanity to Washington.”

At a minimum, the White House wants a multi-year extension of the debt limit to prevent another standoff early in 2013 and risk a government default.

2011 Negotiations

In mid-2011 amid budget talks with Obama that failed, Boehner faced a rebellion from members of the anti-tax Tea Party wing of the party who warned that they wouldn’t vote for a tax increase as part of a deal to raise the debt ceiling.

This time, weeks from the January start of tax increases and spending cuts that the Congressional Budget Office says could lead to a recession in the first half of 2013, fewer House Republicans are trying to influence Boehner’s hand in negotiations.

“The conference is largely calm,” said Representative Patrick McHenry, a North Carolina Republican. “Based on looking around the room and seeing how people are acting, we have one guy negotiating for us.”

Representative Wally Herger, a California Republican, echoed that, adding “it’s much more serious now.”

“You can only have one voice out there speaking for you,” he said.

Even with Republicans appearing to be unified in backing Boehner, Democrats are hinting that the Jan. 3 speakership election could be influencing his negotiating stance with Obama.

Stronger Position

A deal that includes tax rates “could create more churning in his caucus and mean he doesn’t get the votes necessary” to renew his speakership in January, said Maryland Representative Chris Van Hollen, the top Democrat on the House Budget Committee.

Boehner’s removal earlier this month of three Tea Party- backed Republicans from their committee posts is also creating tensions. On Dec. 3, FreedomWorks, a group that supports Tea Party candidates, issued a statement calling the move a “remarkably hostile act” and asking members to call Boehner’s office to “stop the fiscal conservative purge.”

By all accounts, Boehner appears to be in a stronger position with his rank-and-file than he was 2011 during the debt-ceiling debate, when it was uncertain whether House Majority Leader Eric Cantor of Virginia would back the speaker in a deal that included new revenue.

Cantor has endorsed Boehner’s plan to raise $800 billion in revenue by curbing tax breaks. He is joined by Representative Paul Ryan of Wisconsin, the party’s 2012 vice presidential nominee and chairman of the House Budget Committee.

Deadline Negotiations

“I’m not concerned about my job as speaker,” Boehner said at a news conference yesterday. “What I’m concerned about is doing the right thing for our kids and our grandkids. And if we don’t fix this spending problem, their future is going to be rather bleak.”

The up-to-the-deadline negotiations are also part of the culture on Capitol Hill. Last year, Congress reached an agreement to extend the payroll tax cut days before it was set to expire. In 2009, Senate Democrats passed Obama’s health-care legislation on Christmas Eve.

“Ninety percent of lawsuits are settled on the courthouse steps the day of the trial,” said Representative Lynn Westmoreland, a Georgia Republican. “What you are going to look at is a settlement coming around December the 29th.”

To contact the reporters on this story: Heidi Przybyla in Washington at hprzybyla@bloomberg.net; Roxana Tiron in Washington at rtiron@bloomberg.net

To contact the editor responsible for this story: Jodi Schneider at jschneider50@bloomberg.net

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