WASHINGTON - President Obama and the Senate returned Thursday to Washington to revive stalled negotiations to avert a potentially devastating series of tax increases and spending cuts - but both parties remained pessimistic they would find a solution before a crucial end-of-the-year deadline.
"I have to be very honest," said Senate Majority Leader Harry Reid (D., Nev.). "I don't know time-wise how it can happen now."
The president cut short his family vacation in Hawaii to fly back to Washington on Thursday. The Democratic-controlled Senate also returned. But House Speaker John A. Boehner (R., Ohio) on Thursday instructed members not to come back to the Capitol for votes until 6:30 p.m. Sunday, less than 30 hours before the New Year.
Obama will meet at the White House with Republican and Democratic congressional leaders Friday afternoon, according to the White House.
He is calling for a scaled-back package that would raise taxes for individual income above $200,000 and family income above $250,000 - his original proposal that he campaigned on - and an extension of jobless benefits for two million unemployed Americans.
His latest proposal on taxes is less palatable to antitax Republicans than his earlier offer to raise taxes only on income above $400,000 - and much less popular than a fallback plan that Boehner floated but could not get past his own Republican House. And it no longer includes proposed cuts in projected spending Obama had offered before the holidays, all part of a plan that the Republicans rejected.
The president made a fresh round of calls to congressional leaders - Boehner, Reid, Senate Minority Leader Mitch McConnell (R., Ky.), and House Minority Leader Nancy Pelosi (D., Calif.) - late Wednesday in the hopes of jump-starting the talks. The White House declined to release details of the conversations.
"I told the president that we're all happy to look at whatever he proposes," McConnell said. "But the truth is, we're coming up against a hard deadline here, and, as I said, this is a conversation we should have had months ago. And Republicans aren't about to write a blank check for anything Senate Democrats put forward just because we find ourselves at the edge of the cliff. It's not fair to the American people."
Obama and Boehner had been working on a compromise in the weeks following the election. After a possible solution fell apart, the speaker insisted the Senate first pass a bill.
The House previously had passed legislation to extend all the George W. Bush-era tax cuts that expire Tuesday and prevent $109 billion in automatic spending cuts that will take effect Wednesday. The Senate this summer passed a measure to extend only tax cuts for individuals earning less than $200,000 and families making less than $250,000.
Reid opened the Senate session Thursday with a full-throated blast against the House for its failure to be in Washington working to avoid the fiscal cliff that could thrust the nation back into a recession. He accused Boehner of not wanting to bring a viable solution to his caucus until after the new year because of concerns about alienating some House Republicans before he is reelected speaker Jan. 3 at the start of the new Congress.
"We are here in Washington working," Reid said. "While the members of the House of Representatives are out watching movies and watching their kids play soccer and basketball and doing all kinds of things. They should be here."
The Senate was working on unrelated foreign intelligence legislation, not on the budget crisis.
In response, Boehner spokesman Brendan Buck said Reid "should talk less and legislate more."
"The House has already passed legislation to avoid the entire fiscal cliff," he said. "Senate Democrats have not."
House Republicans were told that the chamber will come back into session on Sunday with votes expected after 6:30 p.m., according to the office of House Majority Leader Eric Cantor (R., Va.).
Failure to reach an agreement by the end of the year would mean that billions in tax increases take effect early next year, coupled with more than $100 billion in spending reductions.