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Updated 10:48 a.m. - President Barack Obama would veto House Republicans' "Plan B" legislation should it make its way to the White House, a top administration spokesman said Wednesday.
President Barack Obama and House Speaker John Boehner may be the closest they've ever been to a fiscal cliff deal. The Daily Rundown's Chuck Todd reports.
White House communications director Dan Pfeiffer said in a statement that the GOP backup proposal -- which would preserve existing tax rates on income less than $1 million past the end of this year -- "does not meet the test of balance, and the president would veto the legislation in the unlikely event of its passage."
House Speaker John Boehner, R-Ohio, unveiled the "Plan B" proposal on Tuesday amid stalled talks with Obama toward resolving the combination of automatic tax hikes and spending cuts set to take place on Jan. 1 -- the so-called fiscal cliff.
The proposal would allow tax rates rise on income over $1 million, matching a previous Democratic proposal earlier this year. The administration, however, has set a lower threshold ($400,000 per year) at which it believes taxes should be allowed to rise. Moreover, the administration has argued for a more comprehensive agreement that includes spending cuts and entitlement reforms, but also new spending projects and an extension of unemployment insurance.
Kevin Lamarque / Reuters
U.S. President Barack Obama walks back to the Oval Office of the White House in Washington December 18, 2012.
"The congressional Republican 'Plan B' legislation continues large tax cuts for the very wealthiest individuals - on average, millionaires would see a tax break of $50,000 - while eliminating tax cuts that 25 million students and families struggling to make ends meet depend on and ending critical incentives for our nation’s businesses," Pfeiffer said.
Republicans, as of now, plan to move forward with a set of twin votes on Thursday, one to maintain existing tax rates for those earning less than $250,000 per year (Obama's existing proposal) and the GOP "Plan B" alternative. Boehner. who is continuing to negotiate a broader deal with Obama, will likely have to pass his backup plan only with Republican support -- and even then, conservatives who are leery of raising any taxes at all may defect.
"The president urges the Republican leadership to work with us to resolve remaining differences and find a reasonable solution to this situation today instead of engaging in political exercises that increase the possibility that taxes go up on every American," Pfeiffer wrote.
"The White House’s opposition to a back-up plan to ensure taxes don’t rise on American families is growing more bizarre and irrational by the day," said Boehner spokesman Brendan Buck in response. "Republicans have always said a broader, ‘balanced’ plan is the ideal solution, and we have put one forward. In the absence of a ‘balanced’ solution from the President, however, we must act to stop taxes from rising across the board in 12 days. If Democrats disapprove of this bill, then there is a simple solution: amend it in the Senate and send it back to the House."
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Any of you that think going off the cliff is preferable to making a deal need to pull it out of wherever it is right now. The President is still stick on sticking it to what he sees as the rich folk not because it makes fiscal sense but because he can preen in front of his target constituency. If we go off the cliff he'll look like an idiot because he had the chance to strike a deal but passed it up to go "all in.'
If we go off the cliff he'll look like an idiot....
^ We will go over the cliff, and Boehner is an idiot, so I don't see your point.
Once we do, the GOP's agenda is finished and they can only negotiate with democrats for restoring tax cuts for the middle class but not the rich, and restoring military spending in return for restoration of domestic spending.
While it is true that among the Progressive "useful idiots" Obama can pass off the responsibility to the Republicans, amoung those who understand the long term effects of the Tax Increases that Obama proposes, in historic context, it's known that they have ALWAYS resulted in a reduction of revenues, by an average of 40%! Ask former Governor Patterson of New York, Governor Brown, Governor Quinn, President Hollande, ETC. how well that pratice works in reality!
If ANY of what you guys say was true, I'd be scared.
The truth is, conservatives call for tax cuts under all circumstances. Times are good, cut taxes and give money back. Times are bad, cut taxes to spur the economy.
While it's true that reasonable tax cuts work in some situations, the logic that taxes should never increase fails every time it's tried.
Even the tax cuts we're talking about right now couldn't prevent a huge recession. But conservatives will tell you this recession is someone else's fault or that we should've cut taxes deeper to get out of it.
By the time the negotiations are over I would not be surprised if President Obama will be agreeing with Plan B. No reason to expect any different, after throwing Seniors under the bus when Social Security is owed $2Trillion Dollars and yet he proposed to cut significant benefits from Seniors. I still hear his voice promising to Protect Medicare and Social Security and the least of them every time he was on the Stump. He was not honest. If someone cannot keep their word, that's a huge problem. People stood in lines long after he was confirmed as President to ensure a victory just in case we had a second Florida incident. Yet, when all is said and done, our President's first proposal is to cut Social Security benefits from Seniors and Medicare. Folks that's what the "CI" does. Even when Social Security is owed $2Trillion dollars.
Now the rich can safely relax, because once again the Seniors will be footing the bill to restore the enconomy just like paying for all the bailouts, the bonuses for Walstreet, 2 wars and you name it.
Done with the Democrats, they have no control over their party and the leader has no commitment to its voters.
Same old story. The Dems and the party of "No" don't care about the country, only their political necks. Shame on the Liberal extremists. Shame. And no discussion on cuts. What are Obama's plans to reduce the size and scope of government. Have not heard a thing.
the dems are the party of NO!
What are Obama's plans to reduce the size and scope of government?
^ Typically tea party denial. You lost the election, but you expect the country to follow your defeated agenda anyway. lol.
Piggy must be one of the 47% that pays no income tax!
I think this person is more of the Jim Jones syndrome. Drink the koolaid and not question your benevolent leader. Unfortunately, there are many of these people on both sides. This is why we get what we deserve.
Our government being responsible with our tax dollars (tax payers will lose about $13 billion)
Washington — The Obama administration said Wednesday it will sell 200 million shares— or 40 percent of its remaining stake in General Motors Co. — back to the automaker and announced plans to completely exit the Detroit automaker by March 2014.
The Detroit automaker said it will purchase 200 million shares of GM stock held by Treasury for $5.5 billion — or $27.50 per share — nearly $2 above the stock's closing price on Tuesday. GM shares jumped sharply on the news and were up 6.7 percent to $27.10, or $1.59.
The U.S. Treasury — after more than a year of refusing to say when it might start selling its remaining stake in GM — said it willannounce a written plan in January to shed its remaining 300 million shares over the next 12 to 15 months — likely in a series of small stock sales.
The Treasury's move is intended to minimize the impact of the stock sale on the share price.
The exit plan may prove to be a boost to GM's lagging stock price and to some car buyers, who have avoided GM because of the "Government Motors" label.
Still, taxpayers will almost certainly lose billions of dollars in the $49.5 billion GM bailout. If the government sold the rest of its stock at current prices, taxpayers would lose more than $13 billion.
"The government should not be in the business of owning stakes in private companies for an indefinite period of time," Assistant Treasury Secretary Tim Massad said. "Moving to exit our investment in GM within the next 12 to 15 months is consistent with our dual goals of winding down TARP as soon as practicable and protecting taxpayer interests."
The Treasury has also agreed to waive its ban on GM using corporate aircraft — a condition it imposed on companies that got large bailouts in 2008 and 2009 — but government pay restrictions on top executives remain in force.
The restrictions limit most GM executives to no more than $500,000 a year in cash salaries. GM chief financial officer Dan Ammann said the issue is one of "ongoing discussions" between GM and Treasury.
The Treasury is also waiving a "vitality commitment" that required certain U.S. manufacturing volumes — but GM is already exceeding it and expects to continue, the company said.
Ammann said the company has "no current plans" to buy or lease corporate aircraft. He declined to discuss when the automaker and Treasury began negotiations about the sale or how it settled on the price. Ammann said GM doesn't expect to buy the remaining Treasury shares.
GM CEO Dan Akerson told company executives in an email that the move would help end a painful chapter in the automaker's life that nearly saw the company collapse in late 2008 without emergency government assistance.
"Today, GM and the U.S. Treasury are putting in motion a plan that will begin to close the books on the extraordinary government assistance that saved the company and our industry," Akerson wrote. "It has never been far from my mind that taxpayers rightfully expected us to change the way we do business in exchange for a second chance."
GM — which was criticized for corporate arrogance and for a moribund culture — has reshuffled its entire executive lineup since 2009 and made dramatic changes in how it does business.
"We are learning to be humble and to genuinely appreciate every customer," Akerson wrote.
In a Detroit News interview in 2011, Akerson said GM wasn't changing fast enough.
"Whoever comes after me; it's going to be a more important appointment than mine because he or she will have to carry on a cultural revolution here. It's just like the Communist Party in China in the 1960s, there has to be a cultural revolution here," he said.
GM — which last month obtained a new $5.5 billion line of credit — said its balance sheet will remain strong, with estimated liquidity of $38 billion at the end of 2012, following the closing of the share buyback.
Several analysts have suggested the company would use some of its liquidity to buy back shares.
"A U.S. Treasury sell-down was increasingly anticipated, although the actions were earlier than we expected and at a lower price," Peter Nesvold, an analyst with Jefferies & Co. wrote in a research note Wednesday. "The structure was probably more surprising, as it affords a premium to market price for a control stakeholder."
David Whiston, a senior equity analyst for Morningstar, said he was surprised the government didn't wait for a $33 a share price, but said investors likely were expecting an announcement following the quick AIG sale.
"This helps with the ("government motors") stigma, but there will always be a few hard line consumers who will never forgive GM," he wrote in an email Wednesday. "That doesn't bother me, as GM still sells plenty of cars and has great product. Some taxpayers will be upset by the loss, but I think those people will never be happy about the situation. Even if the sale had happened at $33 (the IPO price) those same consumers would have criticized Obama and GM."
The Canadian federal and Ontario governments — which gave GM a separate $10 billion bailout — still hold about 9 percent of GM's shares. Canadian officials said in Toronto they have no immediate plans to sell.
The announcement comes exactly four years to the day that President George W. Bush announced he would rescue GM and Chrysler with a $17.4 billion bailout in December 2008 using the $700 billion Troubled Asset Relief Program.
Bush stepped in after Congress failed to act. He added $7.5 billion for GM and Chrysler's auto finance arms and President Obama added $60 billion to the $85 billion auto bailout.
"The auto industry rescue helped save more than a million jobs during a severe economic crisis, but TARP was always meant to be a temporary, emergency program," Massad said.
Last week, the Treasury exited another major TARP recipient AIG.
GM stock is still trading far below its November 2010 initial public offering at $33 a share.
The repurchase price of $27.50 per share represents a 7.9 percent premium. The share buyback is expected to close by the end of the year.
The Treasury initially owned nearly 61 percent of GM as part of the bailout as it swapped about $42 billion of the loans for stock in the reorganized company after it exited bankruptcy in July 2009.
The Obama administration forced GM and Chrysler into bankruptcy as a condition of getting additional government aid. The administration forced out GM CEO Rick Wagoner and forced a tie-up with Fiat SpA.
The Treasury has said it expects to lose $24.3 billion on the $85 billion auto bailout.
Treasury also holds a 74 percent stake in Ally Financial Inc., the Detroit-based auto lender, as part of a $17.2 billion bailout.
Last year, the government exited Chrysler Group LLC and booked a $1.3 billion loss on its $12.5 billion bailout.
The government had planned an initial public offering of Ally in 2011 but put it on hold because of market conditions. Any IPO won't occur until after Ally's troubled mortgage unit ResCap completes its bankruptcy restructuring
From The Detroit News: #ixzz2FW7hSmvD
^ The rescue of the Automobile industry saved millions of American jobs and is the reason why the country didn't collapse into a depression.
That was the purpose, not to have the US government make profit off the shares.
Who in this country still, *STILL* doesn't understand that except you and Mitt Romney? LOL.
I didn't write the article.
Uncle Sam Books 50% Loss As Government Motors Buys Back 200MM Shares From Tim Geithner
Submitted by Tyler Durden on 12/19/2012 08:14 -0500
AIGAmerican International GroupBarack ObamaChannel StuffingDepartment of the TreasuryFortress Balance SheetGeneral MotorsGovernment MotorsMarket ConditionsTim Geithner
A few days after divesting its stake in the firm that started it all, AIG, and at a profit at that (ignoring that the risk has merely been onboarded by the Fed whose DV01 is now $2+ billion as a result), the US Treasury continues to divest of all its bailout stake, this time proceeding to GM, where the channel stuffing firm just announced it would buyback 200MM shares from the US government at a price of $27.50. More importantly, the "Treasury said it intends to sell its other remaining 300.1 million shares through various means in an orderly fashion within the next 12-15 months, subject to market conditions. Treasury intends to begin its disposition of those 300.1 million common shares as soon as January 2013 pursuant to a pre-arranged written trading plan. The manner, amount, and timing of the sales under the plan are dependent upon a number of factors." Assuming a price in the $27.50 range, this implies a nearly 50% loss on the government's breakeven price of $54. So much for the "profit" spin. One hopes all those Union votes were well worth the now booked $40+ billion cost to all taxpayers.
One wonders why the US government did not open up this particular buyback to a public tender: after all some taxpayers may still care about the financial mismanagement of Uncle Sam. Then again, perhaps not.
From GM:
General Motors today said it will purchase 200 million shares of GM common stock held by the U.S. Department of the Treasury for $5.5 billion, or $27.50 per share. The share buyback is part of the Treasury's plan, also announced today, to fully exit its entire holdings of GM stock within 12 to 15 months, subject to market conditions.
Treasury has announced its intention to sell its remaining shares of common stock into the market through various means and in an orderly fashion. Treasury intends to begin its disposition of its remaining shares as soon as January 2013, consistent with a pre-arranged written trading plan. In addition, Treasury has agreed to relinquish certain governance rights that were included in the U.S. Treasury Secured Credit Agreement with GM.
"This announcement is an important step in bringing closure to the successful auto industry rescue, it further removes the perception of government ownership of GM among customers, and it demonstrates confidence in GM's progress and our future," said Dan Akerson, chairman and CEO of GM.
Dan Ammann, senior vice president and CFO added, "A fortress balance sheet has been a pillar of GM's financial strategy and has enabled us to undertake today's actions. GM's balance sheet will remain very strong, with estimated liquidity of approximately $38 billion at the end of 2012, following the closing of the share buyback."
The repurchase price of $27.50 per share represents a 7.9 percent premium over the closing price on December 18, 2012. The share buyback is expected to close by the end of the year. This transaction will be accretive to earnings per share, as GM's total shares outstanding on a fully diluted basis will be reduced by approximately 11 percent. In association with this share buyback, GM expects to take a charge of approximately $400 million in the fourth quarter, which will be treated as a special item.
After the repurchase, Treasury will continue to own approximately 300 million shares of GM common stock, or approximately 19 percent of the outstanding shares on a fully diluted basis. Government ownership of GM stock was the result of the auto industry rescue that began under President George W. Bush in 2008 and which was expanded by President Barack Obama in 2009.
The industry in general, and GM in particular, have rebounded sharply since the rescue. Since the rescue, GM has announced investments of more than $7.3 billion in the U.S. and created or retained more than 20,000 jobs.
"We come to work every day grateful that taxpayers from the US and Canada stepped forward to rescue our industry, and determined to show this extraordinary help was worth it," Akerson said.
I am sick of you conservatives wailing about taxes going up on you. Years back, when our country was in really good shape, taxes on the rich were at times 90% and later on 77%. Maybe we should bring those taxes back and then you would really have something to complain about. Quit complaining about Obama wanting you to pay more. This is the country where you made all your money, yet you do everything you can to not have to help it out. Disgusting!
Nomoretax, You cannot tell the freeloaders anything that they don't want to hear !
The GOP,the second amendment the tea billies all have one thing in common.
No one wants them in their current form,,losers
Another inflicted with the JJ syndrome. Boy it's hard to not drink the koolaid.
What I don't get is if Boehner proposes the same plan the Democrats put on the table several months ago...
^ It's not the same, and it's not months ago.
Why didn't he support it months ago?
Maybe he will support the Senates already passed current plans -> "months from now", but it will still be too late.
The Boehner voted for two wars completely unpaid for without batting an eye. Only when there was a Democratic president did the debt and deficit become a crisis to become hysterical over. Debt and deficit is not the biggest problem, finding jobs still is. Get people back to work, get the economy humming again like under Clinton and the debt and deficit will take care of itself. Unfortunately, The Boehner and the GOP don't really want to see the economy succeed under a Democratic president so they will sabotage the economy any time and any way they can.
Recovering Democrat - you must look back at the last four years to see how confused you are. Look at the filibusters that came from the right. It's a record number in case you don't know. Please don't rewrite history to prove your dumba$$ points.
If I was President, I would VETO that crap too.
the president took testosterone against the impotent boehner,way to go mr.President.
Republican's unwillingness to fairly tax the wealthy is to blame. The wealthy will deserve what they get if we don't get some Republican compromise by January 1st.
1. Raise taxes on anyone making more than $250 K per year.
2. Cut the wasteful, bloated Pentagon budget.
Problem solved!
Another inflicted with the JJ syndrome. Boy it's hard to not drink the koolaid.
As I continue to read the postings of the terminally clueless it becomes clear how Obama was re-elected in spite of a record of fiscal recklessness and absolute Irresponsibility! The "rich" will be only little inconvienced and even then only for a very short time by this! Some simple re-structuring and re-locating and they may even benifit as a result, while the revenue stream into the Treasury is reduced by around 40% !
Mr. President!!!!!!! Do not put cuts to Social Security and Medicare on the table just to appease republicans.
If Social Security are not restructured they will not survive! Medicare will exhause all it's funds, at current rates by 2017 and Social Security by 2033! To refuse to address this issue to secure the votes of the uninformed is to destroy the systems completely! I'll be gone before Social Security ends, but my Children and Grandchildren will still be here! It's only those so greedy and selfish as to not care for their own family members that refuse to acknowledge the problem!
If the House have enough votes to override Obama's veto then Obama can shove his veto up where the sun does not shine!!!!
To override a presidential veto takes a vote of two-thirds of each of the Senate and the House.
Read the Constiturion Mark. As Steve said, it takes both the house and the senate to override the President and I do not think the Senate will.
Mark, your knowledge of civics is as bad as your knowledge of history and math. Listen more and talk less.
Jon boner is the biggest a hole in government. he wants to cut funds for the disabled and cut funds for the disabled veterans. thats bull.. being a veteran i object to having this guy do anything but resign. republicans have lost confidence of the people. damn man, get your freakin act together. you are an arrogant stupid individual who needs to resign or be impeached. holding the middle class hostage is outragious. you make me sick..... jon boner, resign you worthless dufuss.
If they cut most of the crap out of the budget which would be government spending plus all the little trips el presidente goes on perhaps things would be better! Plus let's cut down on the secret service protection that all these prior presidents and their families get! If they want protection then hire your own staff and pay for it out of your own pocket!
Tax rates on the wealthy are VERY LOW, compared to other times in the last 80 years, when our country was strapped for cash. Scroll down and look at the graph here:
http://www.businessinsider.com/history-of-tax-rates?op=1
Boehner, get yourself a history lesson.
Obama has made many reasonable concessions. If the GOP wants to let this country go off the fiscal cliff on 01/01/13, so be it but lets all make sure we give the GOP the 100% credit it will deserve for the act.
Name ONE just ONE "Reasonable cut" Obama has proposed!
Ted,
You can educate yourself here: http://www.whitehouse.gov/sites/default/files/omb/budget/fy2013/assets/ccs.pdf
i have to ask you ted,are you a millionaire?
Checkered - That document that Carney waives around and your link are the President's FY 2013 budget request. The same one that DID NOT receive one vote in the Democratic controlled Senate.
tedcrawford
My actual words were concessions, not cuts. But if you want to use cuts, he agreed to cut from SSI and Medicare (Which by the way will effect the elderly more than anyone but that is what the GOP wants), He agreed to reduce government spending, and he agreed to raise the income ceiling for tax hikes from $250,000 to $400,000 dollars. So unless you are in the $400,000+ income level, then he has actually helped you. And if you have an elderly parent or grandparent who depends on SSI and Medicare, he agreed with the GOP that they should be made to suffer while you are allowed to prosper.
He also agree to reduce the cost of living increases on all Entitlement programs designed to help those (Women, and Children primarily) who need it most.
Hey tedcrawford, why should Obama suggest spending cuts? It's the republicans that want them. Is he supposed to be having a debate with himself?
Baccardi Boehner keeps his tricks coming or just wants us to be royally confused, while exhausting Prez Obama. Remind me: why is the leader. Right. I say, boot him out pronto.
Obama would veto GOP
Baccardi Boehner will keep his tricks up. That is what he is there. He is the worse HOR speaker.
The new American way take from those who work harder, punish those who try the hardest!!
If you raise taxes on one set of this country you raise taxes on all!!!!!!!!
Also if you don't pay Federal taxes you should not be able to vote in a Federal election.
Also if you don't pay Federal taxes you should not be able to vote in a Federal election.
Tell that to all the WWII vets in the rest homes.
Never mind I forget that most people on here dont really have any common sence I am saying that if you are of working age and not disabled.
Wall Street Bankers do not produce one thing that helps the nation's GDP, yet they have converted much of the wealth to their own pockets. It is time to get that money back.
Thank you for sticking to your guns, Mr. President. Yet another reason you well deserved "Person Of The Year".
Right On! The President laid out some real compromise in his last proposal and the Republicans simply wont make a sensible deal because they are dead set on getting what they want. Not allowing a deal to get done keeps the economy and the markets unstable. Not getting a deal done hurts the middle class but the Republicans dont give a S H I T. Not that we thought they did.
Way to go Mr. President! You already have a bill signed into law which raises EVERYONE's taxes and makes some immediate cuts in spending. You can posture, name-call, etc. all you want, but come January 1, everyone will start paying more taxes, and imagine this, actually pay their full contribution to their Social Security! I mean really folks - who in their right mind feels that having someone in the 2% subsidizing 30% of your Social Security is right?
Lets go off the cliff. SS and Medicare are off the table in the sequester and Defense takes huge cuts. I'm not sure we can get a better deal.
How do you figure that Obama is sticking to his guns?
This whole process is bogus... they need to go over the cliff instead of negotiating away the minuscule revenue increases that he sought to begin with.
These marginal tax rates to the mega rich mean nothing. The Republicans are playing us and making a big deal out of it but ultimately what they really care about is dividend,capital gains and estate tax because this is where the big money is for the rich.
Obama is being sucked in and focusing on marginal income tax rates which will not even put a dent in the deficit because the rich won't be paying it.... simple as that. Wake up people.
Go over the cliff...grant tax relief to the majority which the Republicans cannot reject and than do some major tax reforms in the new year. Lets attack the major government costs at the top first of all and make sure that programs are being administered properly and fairly before we start cutting the benefits to the most needy in society. Cut the fat out of the system before anything else. Lets start by cutting the salaries and benefits of our overpaid politicians first. The majority of Americans have experienced stagnated wages...while these guys keep increasing their pay... how about we start there instead of allowing Obama to negotiate anything he might have gained.... away. He is in over his head with these guys and will never win.
Rob - sorry to burst your bubble, but if the Republicans in the House won't vote on the Senate bill right now, why do you think they will vote for "tax reief to the majority"?
Republicans. Definition; Guys who lose the election and behave as if they won. What nonsense!
Come on Boehner get some balls and turn in plan B then go home for Christmas ! If Obama wants to go over the cliff it will be his doing !!!
John Boehner? Balls? Dont make me laugh.