By Russell Berman - 07/12/11 06:03 PM EDT
Speaker John Boehner (R-Ohio) told House Republicans on Tuesday that the far-reaching debt reduction agreement he discussed with President Obama “is no longer operative” and that he “at no time” agreed to let taxes go up.
In a closed-door briefing for his conference, Boehner detailed his negotiations with Obama and pledged to fight for deep spending cuts and reforms in any deal to raise the debt limit, including a balanced-budget amendment. The Speaker said, as he has in public, that the talks broke down over taxes and Obama’s insistence that an overhaul of the tax code increase the “progressivity” of the current system.
“Let me be crystal clear on this: at no time, ever, during this discussion did I agree to let taxes go up,” Boehner said, according to prepared remarks provided by a source in the room.
The Speaker said he walked away from the talks when it became clear that Obama would only agree to entitlement reform in exchange for “tax hikes.”
“Am I angry about it? I sure as hell am,” Boehner told Republicans. “I believe we are missing a great opportunity.”
Boehner has come under criticism from conservatives outside Congress for pursuing the grand bargain, and he faced opposition from Majority Leader Eric Cantor (R-Va.), who pushed for a more modest agreement. The two leaders have sought to close ranks in recent days, and they presented a united front before the GOP conference.
Boehner and Cantor are headed back to the White House on Tuesday afternoon for a 3:45 p.m. meeting with Obama and other congressional leaders. It's the third straight day of White House meetings on the debt negotiations.
Boehner said Obama pushed to “decouple” the Bush-era tax cuts for the middle class from those for the wealthy, which Republicans have opposed as a backdoor way of increasing taxes on top earners and small businesses. The Speaker said he would only have agreed to do so in exchange for a guarantee from Obama that comprehensive tax reform would be enacted by the first quarter of 2012. That reform, Boehner said, would create three personal income tax rates with a top rate lower than the existing 35 percent maximum rate, making the expiration of the Bush tax cuts for the wealthy “irrelevant.”
“I wanted tax reform that broadens the base, simplifies the code, and lowers rates, to boost economic growth,” Boehner said. “The president could not accept that because he wanted to increase the ‘progressivity’ of the current system. This is where things began to break down.”
The Speaker also made his most forceful defense of the balanced-budget amendment to the Constitution, a favorite of House conservatives that is opposed by the White House.
“I support a balanced budget amendment, and we're going to fight for one,” Boehner said. “Any debt limit bill we pass will have to include enforceable caps on future spending — and I can't think of any better way to enforce those caps than a constitutional amendment requiring Washington to balance the budget.”