WASHINGTON — President Obama said on Bloomberg Television that a Republican offer on averting the so-called fiscal cliff won't raise the revenue needed to shrink the deficit by $4 trillion over the next decade.
“We have the potential of getting a deal done,” Obama said Tuesday at the White House in his first television interview since winning re-election. “Unfortunately,” he said, House Speaker John Boehner's proposal “right now is still out of balance.”
The primary obstacle to a compromise is Republicans’ refusal to raise marginal income tax rates on the top two percent of earners, he said.
Obama spoke the day after Boehner sent a letter to the White House countering the administration's plan with a proposal that included $2.2 trillion in new revenue and spending cuts without raising rates.
“We're going to have to see the rates on the top 2 percent go up, and we're not going to be able to get a deal without it,” the president said.
Obama, 51, said he's willing to further cut entitlements and realizes he won't get “100 percent” of what he wants in negotiations to avoid about $600 billion in automatic spending cuts and tax increases due to take effect at the start of 2013.
The president's comments come amid a stalemate between Obama and congressional Republicans over averting the fiscal cliff, at a time when each side has staked out a position that the other regards as unacceptable, and there are few outward signs of productive negotiation toward a compromise.
Obama is insisting that any deal must raise income tax rates on individuals earning $200,000 or more and households earning $250,000 and above annually, while Republicans are demanding entitlement benefit cuts.
There are about four weeks left to break the logjam. The Congressional Budget Office has warned that failing to do so might pitch the U.S. economy into a recession.
Boehner and Obama, who last year fell short of forging a bipartisan bargain to reduce the deficit while averting a breach of the U.S. government's legal borrowing limit, have yet to engage in the personal negotiations that previously brought them to the brink of a deal.
At a White House holiday party Monday night, the two men holding the keys to a compromise did not speak even to exchange pleasantries, according to aides to both.
“Speaker Boehner and I speak frequently,” Obama said. “I don't think that the issue right now has to do with sitting in a room.”
Both face pressure from their political bases to resist a compromise, with Boehner's tea party-infused House Republicans balking at raising tax rates while labor and other Democratic-aligned interest groups reject the idea of slashing entitlements including Medicare and Social Security.