Plan B crashes before vote, Obama vows to press ahead

Written by Associated Press | Washington | Updated: Dec 22 2012, 08:04am hrs
President Barack Obama says hell press ahead with Congress to prevent across-the-board tax increases set to strike taxpayers January 1 after Republican Party leaders in the House of Representatives unexpectedly put off a vote on legislation calling for higher rates on million-dollar earners.

The measure did not have sufficient support from our members to pass, House speaker John Boehner, the Republican speaker in the House, conceded in a brief statement when the vote was abruptly scrapped on Thursday evening.

At the White House, press secretary Jay Carney said that Obamas main priority is to ensure that taxes dont go up on 98% of Americans and 97% of small businesses, citing statistics associated with Obamas campaign promise to increase top tax rates on households earning more than $250,000 a year.

The President will work with Congress to get this done and we are hopeful that we will be able to find a bipartisan solution quickly that protects the middle class and our economy, Carney said. Pointedly, the statement didnt say whether Obama would work with Boehner to revive stalled talks with Boehner or turn to the Democratic-controlled Senate to try to salvage the situation.

Boehners attempt to tactically retreat from a longstanding promise to maintain Bush-era tax rates for all was designed to gain at least some leverage against Obama and Senate Democrats in the fiscal cliff endgame. Thursdays drama was a major personal defeat for the speaker, who retains the respect and affection of his tea party-infused conference, but sometimes has great difficulty in getting them to follow his leadership.

Boehners Plan B was crafted to prevent tax increases set to kick in on January 1, 2013, on virtually every taxpayer. But a provision that would have let rates rise for those at the upper income range a violation of long-standing Republican orthodoxy triggered the opposition of anti-tax lawmakers inside the party. The hope was that successful House action on the measure would force Senate Democrats to respond. But Senate Majority leader Harry Reid, a Democrat, made it clear that Plan B would have been dead on arrival in the Senate. Speaker Boehners plans are non-starters in the Senate, Reid said.

Boehner announced he would move to Plan B after testing the waters with fellow Republicans regarding a possible pact with Obama on tax increases of $1 trillion including the breakthrough proposal on higher tax rates. He found them not very receptive.

The House is not due to meet again until after Christmas, while the Senate is expected to meet briefly on Friday, then not reconvene until next Thursday.

Boehner said the House has previously passed legislation to prevent all the tax increases from taking effect, and noted that earlier in the evening it had approved a measure to replace across-the-board spending cuts with responsible reductions.

In arguing for legislation with a million-dollar threshold for higher tax rates, Boehner said the president has called for legislation to protect 98% of the American people from a tax hike. Well, today were going to do better than that, he said of the measure that raises total taxes by slightly more than $300 billion over a decade. Our bill would protect 99.81% of the American people from an increase in taxes.