By Peter Schroeder - 12/05/12 09:31 PM EST
The White House is "absolutely" prepared to go over the "fiscal cliff" if Republicans do not agree to raise tax rates on the wealthy, according to Treasury Secretary Timothy Geithner.
The president's top economic adviser was resolute in a Wednesday interview, saying the administration would not budge and was willing to let the components of the fiscal cliff — expiring tax cuts and automatic spending cuts — take effect if Republicans refuse to concede on taxes.
"Absolutely," said Geithner. "We see no prospect for an agreement that doesn't involve those rates going up on the top 2 percent of the wealthiest."
Geithner also indicated that the president's push to take control of the nation's debt limit was a vital component to any agreement. The White House's original proposal included a provision that would let the administration raise the debt limit as needed, leaving Congress only the opportunity to pass measures, subject to a presidential veto, disapproving of the hike.
"We're not going to make the American people pay the price again for a group of minority Republicans who say they want to threaten default occasionally," he said.
Geithner indicated that the White House was willing to look for a compromise on spending cuts, including entitlement reforms, but would only come to the table once the GOP agrees to raise tax rates.
"If Republicans recognize this basic reality, that rates are going to have to go up as part of a balanced plan ... we will be prepared to do a substantial amount of meaningful reforms on the spending side, including entitlements," he said. "We think there's a lot of room for movement on that side, provided there's that recognition."