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Republicans Reject White House Fiscal Outline As ‘Unbalanced and Unreasonable’

House Republican leaders quickly rejected what they described as a sweeping new deficit-reduction plan Obama administration officials offered during meetings Thursday on Capitol Hill.

The proposal leaked to reporters includes the nearly $1.6 trillion in additional tax revenue over 10 years that the White House earlier endorsed. Upper-bracket income tax rates would be permitted to increase next year, as would taxes on capital gains and dividend income.

The proposal outlined by Republican sources would also postpone for a year the automatic cuts in discretionary spending scheduled to begin next year, trim $400 billion from federal health care programs, extend a “patch” for the alternative minimum tax, extend tax incentives for business and renew extended unemployment compensation.

The proposal was also said to include a new multi-year economic stimulus plan including at least $50 billion in infrastructure spending in fiscal 2013, and perhaps an extension of the current payroll tax reduction.

Republicans were especially critical of what they described by a White House plan to put in place a new mechanism that would increase the government’s borrowing limit without congressional approval.

The White House did not immediately respond to calls for comment on the GOP description of the offer from Treasury Secretary Timothy F. Geithner and Rob Nabors, the chief White House lobbyist.

Republicans portrayed the deficit reduction plan they outlined as an effort to raise taxes and strengthen the executive branch. A Republican aide called the framework “unbalanced and unreasonable” and said the administration officials largely reiterated components of the White House’s fiscal 2013 budget proposal.

“After weeks of negotiations, they just demanded all of their favorite proposals, with no sign of compromise whatsoever,” the GOP aide said.

A spokesman for Democratic Sen. Charles E. Schumer of New York said Republicans were simply renewing their criticism of the administration’s earlier proposals in order to denounce them in statements to “gullible Hill reporters.”

“If House Republicans consider the president’s budget a ‘new’ offer, then we await their counteroffer,” Schumer said in a written statement. “The ball is now in their court to state what they would do on entitlements and taxes. They have given no specifics so far.”

Democratic Reps. Sander Levin of Michigan and Chris Van Hollen of Maryland confirmed that Geithner and Nabors had stuck to other key parts of President Barack Obama’s blueprint for $4 trillion in deficit reduction, including the $1.6 trillion in revenue.

A senior Democratic aide said the plan Geithner and Nabors outlined included a one-year extension of the payroll tax cut expiring at the end of the year, as well as a one-year extension of extended unemployment benefits. Nearly $900 billion in revenue would come from freezing tax rates for the middle class, while allowing tax rates to increase for families earning more than $250,000 a year. And more than $700 billion would come on several other tax increases aimed at wealthy families, including raising the current 15 percent rate on capital gains and dividends.

The first and largest proposal would raise $584 billion over 10 years by limiting the value of tax expenditures, or deductions, to 28 percent. The other two proposals would put additional limits on itemized deductions for upper income earners to raise about $123 billion over ten years, and reinstate a personal exemption phase-out for upper-income taxpayers, raising $42 billion over 10 years.

A senior Senate Democratic aide said caucus leaders backed the administration’s call for authority to raise the debt limit without congressional approval. “We’re on the same page,” the aide said.

A senior House Democratic aide said the proposal would provide that the president could raise the debt limit but that Congress could vote to block it with legislation. The president could veto that action, and Congress could override that with a two-thirds majority of both chambers.

House Rules Chairman David Dreier of California portrayed Obama’s proposal as an attempt to revive a variation of the so-called “Gephardt rule,” named for former Majority Leader Richard Gephardt of Missouri, which provided that a debt limit increase would come with approval of a budget resolution and without a separate vote on the debt limit increase itself.

Dreier said that would be strongly opposed by the GOP. “It’s not a good idea. This is one of the very important tools that we have, ” Dreier said.

Sen. Jeff Sessions, R-Ala., the ranking Republican on the Budget Committee, said the plan is simply “a distraction that allows the White House to continue to run out the clock so it can have maximal leverage to force through a bad deal in the last minutes before midnight.”

Paul M. Krawzak contributed to this story.

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