The administration hasn’t taken a public position on the extension of the payroll tax cut, which reduces employees’ share of the tax for Social Security to 4.2 percent from 6.2 percent. The current break, which started in 2011, expires Dec. 31.
Geithner said in a Nov. 16 Bloomberg Television interview that the U.S. should abolish the debt ceiling, arguing that it enabled the threat of default in 2011. “The sooner the better,” he said. Republicans have used previous debates over increasing the debt limit to hold out for policy changes.
The proposal seeks infrastructure spending similar to what Obama proposed in September 2011 in his American Jobs Act, which included $50 billion for roads, rails and airports and $30 billion for schools.
The Congressional Budget Office has warned that if Congress doesn’t avert the fiscal cliff, the economy might slip into recession next year and boost the unemployment rate to 9.1 percent in the fourth quarter of 2013, compared with 7.9 percent now.
House Speaker John Boehner, while urging Obama yesterday to propose “serious spending cuts,” avoided publicly discussing specific options for a budget deal. The speaker wouldn’t say how large a spending cut he seeks for an agreement by year’s end.
It’s not “productive for either side to lay out hard lines” because “there are a lot of options of how to get there,” said Boehner, an Ohio Republican.
Boehner “knows that part of it is a waiting game until the pressure builds to where there is decision,” said Republican Representative Steve King of Iowa. “Barack Obama and John Boehner in the end are going to offer something back here.”
At a briefing yesterday, White House press secretary Jay Carney responded to questions about Republican complaints that the administration wasn’t offering specifics by holding up a proposal Obama presented in September 2011.