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McConnell Accuses White House of Moving Backward on Cliff Talks

Senate Minority Leader Mitch McConnell said Thursday that the White House “took a step backward” in its meetings with congressional leaders on the looming fiscal cliff, joining House Speaker John A. Boehner in a negative view of the talks.

McConnell issued the sharp statement after meeting with Treasury Secretary Timothy M. Geithner and White House lobbyist Rob Nabors, as the Obama administration’s lead negotiators on the tax and spending measures held a series of separate briefings with congressional leaders.

Nabors had a different view as he left McConnell’s office for a one-on-one meeting with Senate Majority Leader Harry Reid of Nevada. “Things are going fine,” he said.

But McConnell, who began the day calling on the Senate floor for President Obama to embrace a plan to limit deductions in order to raise revenue, added to the grim assessment that Boehner, R-Ohio, made on the House side of the U.S. Capitol.

“Today they took a step backward, moving away from consensus and significantly closer to the cliff, delaying again the real, balanced solution that this crisis requires,” the Kentucky Republican said. “This is a real problem. Every day they delay brings us one step closer to the fiscal cliff that we simply must avoid.”

McConnell said the administration provided “no specific plans to protect Medicare and Social Security or reduce our national debt in a meaningful way.”

Reid, meanwhile, said he didn’t know why Boehner appeared to be waiting for a full offer on the fiscal cliff issues. “I don’t understand his brain,” he said of Boehner.

Reid said the administration, which has already said it would seek $1.6 trillion in new tax revenue and spending savings, had not come with a formal proposal that would replace the impending tax increases and automatic spending cuts that make up the fiscal cliff. “There was no offer. There’s no offer to be made,” Reid said.

Nabors would not address specifics that may have been raised in the meetings. “I’m not going to get into what was said in the room.”

Asked whether the administration could support a cap on deductions instead of reverting to higher tax rates at the end of the year, he said, “I’m not going to speculate about hypotheticals at this point.”

Earlier, Reid renewed his call for House passage of a Senate-passed extension (S 3412) of expiring tax cuts for families earning less than $250,000 a year. He noted that passage of the bill has drawn the support of some Republicans, among them Rep. Tom Cole of Oklahoma, a former chairman of the National Republican Congressional Committee. “Now reasonable Republicans are coming around to what Democrats . . . said all along,” Reid said.

McConnell said he believes that capping tax breaks for upper-income families would produce sufficient revenue for dealing with the deficit and clinching a deal on the fiscal cliff.

He called for a bipartisan deal incorporating a cap on deductions for high-income families, and said he hoped Geithner would be bringing a “specific plan from the president that the two parties could agree to for the good of the country.”

“Instead of raising rates, Republicans have proposed capping deductions through tax reform instead. If the only way to get Democrats to agree to pro-growth tax reform and meaningful entitlement reform is through more revenue, a smarter way to do it is by capping deductions. Capping deductions, or tax expenditures as some call them, is a far less painful, more economically sound way of closing deficits,” McConnell said.

McConnell noted that Obama has proposed several ideas for capping deductions in the past, and he said those ideas combined would “dwarf the $442 billion revenue his own Treasury estimates he could grab from increasing the top two rates.”

Meredith Shiner and Humberto Sanchez contributed to this story.

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