Senate Majority Leader Harry Reid (D., Nev.) speculated that there may no longer be time to avoid tax increases and spending cuts.
WASHINGTON — President Obama summoned congressional leaders to the White House today in a last-ditch effort to protect taxpayers, unemployed workers, and the fragile U.S. recovery from severe austerity measures set to hit in just four days.
Also Thursday, House Speaker John Boehner (R., Ohio), announced he would call the House back into session this weekend. And in perhaps the most significant development, Senate Minority Leader Mitch McConnell (R., Ky.), for the first time was engaged directly in talks with the White House. He signaled an interest in cutting a deal.
“The truth is, we’re coming up against a hard deadline here ... and Republicans aren’t about to write a blank check for anything Senate Democrats put forward just because we find ourselves at the edge of the cliff,” Mr. McConnell said on the Senate floor.
“We’ll see what the President has to propose,” Mr. McConnell said. “Hopefully, there is still time for an agreement of some kind that saves the taxpayers from a wholly preventable economic crisis.”
This marks just the fifth time since the 1930s that members of Congress have been dragged back from their holiday break to a post-Christmas session in Washington.
With uncertainty about a solution producing volatility in the equity markets, aides in both parties expressed hope that legislation could be enacted before the New Year’s Eve deadline. They cautioned, however, that quick action would require leaders in both chambers to rally firmly around a specific set of proposals.
One option that could potentially win broad support, aides said, was allowing taxes to rise on household income over $400,000 a year — Mr. Obama’s latest offer in negotiations with Mr. Boehner — rather than the lower threshold of $250,000 a year, as Mr. Obama proposed during the presidential campaign. Publicly, there was little sign of such a thaw.
Instead, a sense of gloom pervaded the Capitol. Senate Majority Leader Harry Reid (D., Nev.) openly speculated on the Senate floor that there may no longer be time to avoid more than $500 billion in tax increases and spending cuts scheduled to take effect next week.
In preparation for that possibility, each party stepped up its efforts to proactively deflect blame, insisting the other must act first.
Mr. Reid urged the House to take up an “escape hatch” bill adopted by the Senate in July that would forestall the worst of the cliff’s economic consequences by extending tax breaks adopted under President George W. Bush for income under $250,000.
He charged that Mr. Boehner is running a “dictatorship” in the House, refusing to bring forward the legislation because it might pass with broad Democratic support and a handful of Republican votes.
“Nothing can move forward in regards to our budget crisis unless Speaker Boehner and Leader McConnell are willing to participate in coming up with a bipartisan plan,” Mr. Reid said. “So far, they are radio-silent.”
Mr. McConnell retorted that Republicans have been eager to work with Mr. Obama. After one-on-one talks between Mr. Obama and Mr. Boehner failed to produce a broad deficit-reduction package last week, Mr. McConnell said it is the President’s responsibility to put forward a new plan.
“Republicans bent over backwards,” he said. “We wanted an agreement. But we had no takers.”
Mr. McConnell said the Senate’s bill was not a viable option because it was approved with only Democratic votes and because measures dealing with revenue are required by the Constitution to originate in the House.
Mr. Boehner also told Republican lawmakers in a conference call that the Senate must act first. He said the Senate should take up and amend a bill passed by House Republicans in August to extend tax breaks for Americans at all income levels and another approved in May that would shift military spending cuts set for next month to domestic programs.
Even Starbucks entered the fray, urging baristas in Washington to write “Come together” on their customers’ cups to encourage cooperation by lawmakers.
White House officials and Senate Democrats denied a new proposal was forthcoming. But Mr. McConnell insisted throughout the day that he was eager to review a new offer. Ultimately, both parties confirmed that quiet talks were under way between aides to Mr. McConnell and senior White House officials, but the details were in flux.
“It’s all theatrics now,” Sen. John Cornyn (R., Tex.), Mr. McConnell’s incoming chief deputy, told reporters.