By Meghashyam Mali - 12/02/12 02:50 PM EST
Treasury Secretary Tim Geithner sought to raise pressure on Republicans amid “fiscal cliff” talks, insisting Sunday that any deficit deal would need to raise tax rates on the wealthiest.
“There's not going to be an agreement without rates going up,” said Geithner, who appeared on all Sunday morning shows, during an interview with CNN’s “State of the Union.”
Lawmakers and the White House are working to reach a deficit-reduction deal to avoid the looming tax-rate rises and automatic spending cuts set to take effect on Jan. 1, which economists warn could bring on a new recession.
Democrats want to extend the Bush-era tax rates for middle class families, while allowing the current lower rates for those with income over $250,000 to expire.
Republicans, though, say they want to extend the rates across the board, claiming any rate rise would hurt the economy. GOP lawmakers want new revenue to come from closing loopholes and deductions in the tax code, instead of from tax-rate rises.
Geithner on Sunday defended the initial White House deficit plan, which Republicans quickly rejected last week.
“It's a very good plan and we think it's a good basis for these conversations,” said the secretary. “What we did is put forward a very comprehensive, very carefully designed mix of savings and tax rates to help us put us back on a path to stabilizing our debt, fixing our debt and living within our means.”
On Thursday, Geithner presented lawmakers with the initial administration offer, which included $1.6 trillion in tax increases and $400 billion in cuts to entitlement spending.
Speaker Boehner (R-Ohio) rejected the plan as “not a serious proposal” and said the White House had asked for new spending that he said exceeded the upfront cuts proposed.
Boehner on Friday said negotiations were at a “stalemate” and called on Democrats to do more to match the GOP at the bargaining table, after Republicans said they were willing to allow tax revenue increases in any proposed deal.
In an interview with Fox News Sunday, Boehner maintained his criticism of the White House plan, calling it “nonsense.”
The speaker said he was “flabbergasted” when he saw the proposal.
The White House “has responded with virtually nothing, they’ve actually asked for more revenue than they’ve been asking for the whole time,” Boehner said.
“At the end of the year, they wanted to extend unemployment benefits, they wanted a new stimulus program for infrastructure, they wanted to extend some other tax breaks and all of this new stimulus spending would literally be more than the spending cuts that he was willing to put on the table,” Boehner added.
“I think we're far apart still, but I think we're moving closer together,” said Geithner. “This is something we can do. And I think we're going to get there, because there's too much at stake not to get there, not just for the American economy, but for the world economy.”
But Geithner also said that the next move would have to come from the GOP.
“I think right now, the best thing to do is for them to come to us and say, look, here's what we think makes sense,” Geithner said. “What we can't do is try to figure out what's going to be good for them. They have to come tell us.”
“They're in a hard place,” he added later. “And they're having a tough time trying to figure out what they can do, what they can get support from their members for. That's understandable… This is very difficult for them, and we might need to give them a little more time to figure out where they go next.”
This story was updated at 9:58 a.m.