Republicans offer Obama short-term 'cliff' fix

Republicans laid down negotiating terms on the looming "fiscal cliff" Wednesday, telling just re-elected President Barack Obama they would accept closing loopholes but not higher tax rates to boost revenues.

House of Representatives Speaker John Boehner said that Republicans were ready to make a short-term fix to avert the economy-crunching spending cuts and higher taxes slated to come into law on January 1.

But he said a longer-term deal to cut the country's debt and deficit burden would have to rely on a shakeup of the tax code -- cutting loopholes and special breaks -- to boost government revenues rather than Democrat-favored tax increases.

"Mr. President, the Republican majority here in the House stands ready to work with you to do what's best for our country," Boehner said.

"What we can do is avert the cliff in a manner that serves as a downpayment on and a catalyst for major solutions enacted in 2013 to begin to solve the problem."

Boehner made clear he did not think a comprehensive long-term plan for debt reduction can be reached in the next seven weeks of the outgoing "lame duck" Congress, but that a short-term compromise could be achieved.

That was a challenge to Obama, who has previously opposed calls for a short-term fix, arguing that this just "kicking the can down the road."

"The American people this week didn't give us a mandate to do the 'simple' thing. They elected us to lead," Boehner said, after his Republicans retained their majority in the House in Tuesday's elections.

Boehner also gave no ground on Obama's demand that any deal include higher tax rates for the wealthy.

"The president has called for a balanced' approach to the deficit -- a combination of spending cuts and increased revenues.

"But a 'balanced' approach isn't balanced if it means higher tax rates on the small businesses that are key to getting our economy moving again and keeping it moving.

"A 'balanced' approach isn't balanced if it means we increase the amount of money coming into the coffers of government, but we don't cut spending and address entitlements at the same time."

Boehner emphasized as well that tax changes would have to be growth-oriented and come with changes to the country's social security and Medicare programs.

"What matters is where the increased revenue comes from, and what type of reform comes with it.

"Does the increased revenue come from government taking a larger share of what the American people earn through higher tax rates? Or does it come as the byproduct of a growing economy, energized by a simpler, cleaner, fairer tax code, with fewer loopholes, and lower rates for all?"

Obama, who spoke with Boehner in a private phone call earlier, made no immediate comment on his statement.

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