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GOP dismisses White House initial offer as 'unbalanced,' 'unreasonable'

The gulf between Republicans and Democrats on the “fiscal cliff” grew larger today as the GOP dismissed the White House’s opening offer as “unbalanced” and “unreasonable.”

Late this afternoon, details of the President Obama’s first proposal in dealing with the fiscal cliff were leaked by GOP aides upset that Treasury Secretary Timothy Geithner presented an offer they believed was one-sided and illogical.

Geithner’s offer included a $1.6 trillion tax increase, an extension of the payroll tax cut and unemployment insurance, as well as a request for $50 billion dollars in new stimulus spending for fiscal year 2013.

“We’ve offered a ‘balanced’ approach to deal with the fiscal cliff: raising revenue in a way that protects jobs while cutting spending,” a congressional Republican, familiar with the talks, contended. “But, after two weeks of discussions, the offer the White House made today is completely unbalanced and unreasonable, and amounts to little more than reiterating the president’s budget request – which failed to get a single vote in the House or Senate.”

The aide then laid out the GOP’s problem with the proposal: 

1)            Earlier this year, the Senate passed a tax bill with 51 votes, after a full-bore lobbying campaign by the White House.  That bill – which the White House has constantly been calling on Congress to pass – would raise approximately $800 billion in additional tax revenue.  The White House offer today called for nearly twice that amount of tax revenue, including plenty of rate hikes.  While $1.6 trillion is the White House’s public position, it is ridiculous to offer that amount two weeks after negotiations began - and less than a month before we must have a solution.  Why on Earth would the White House think the Senate would or could pass a bill with DOUBLE that amount in tax hikes? (let alone the House?)

2)            The White House keeps saying it wants a ‘balanced approach’ but this offer is completely unbalanced and unrealistic.  It calls for $1.6 trillion in tax hikes – all of that upfront – in exchange for only $400 billion in spending cuts that come later.  Plus, the only entitlement changes they proposed come from the exact proposals in the President’s budget. 

3)            They also want a permanent, unlimited debt limit increase – for free.  No additional cuts or reforms.  Not to mention a host of other, unrelated White House proposals – including even more ‘stimulus’ spending.

The conservative publication The Weekly Standard reported that Senate Minority Leader Mitch McConnell (R-KY) “burst into laughter” when Geithner offered the plan, because it was so “one-sided and vague on spending cuts.”

The flat-out rejection could mark a significant turning point in the negotiations between the White House and congressional Republicans. No longer is there post-election optimism for a large, bipartisan deal.

“With this opening offer, we’ve essentially wasted three weeks," another GOP aide told NBC News.

Significant breakdowns were part of the 2011 “Grand Bargain” debt talks in the summer of 2011, but they did not occur this early in the process.

This could also, however, be just the opening salvo in what will be long, intensive negotiations. It signals that the White House is not about to start negotiations with major concessions after winning reelection, something the president has previously been criticized for from the left.