Obama to Offer Final “Cliff” Proposal

This afternoon's last-ditch “fiscal cliff” meeting between President Obama and congressional leaders is expected to include discussion of one final proposal form the president, CBS News has learned.

A member of the House Democratic leadership confirms to CBS News' Congressional Correspondent Nancy Cordes that they expect Mr. Obama to lay out a package to avert the “cliff” at his meeting with Senate Majority Leader Harry Reid, D-Nev., House Majority Leader John Boehner, R-Ohio, Senate Minority Leader Mitch McConnell, R-Ky., and House Minority Leader Nancy Pelosi, D-Calif.

It reportedly will look very similar to what the president proposed before talks broke down between the White House and Boehner, though to move the talks forward rapidly, considering it's less than four days before the “cliff” hits, he might throw in some sweeteners for Republicans, potentially an entitlement cut such as “chained” consumer price index (CPI) for Social Security, which would measure inflation at a different rate, resulting in lower Social Security payments for recipients. 

Before Mr. Obama and Boehner cut their talks off prior to Christmas, they were seemingly closing in on a deal, with the president offering $1.2 trillion in tax revenues and $800 billion in spending cuts to Boehner's $1 trillion of each. Also, Boehner had proposed letting the Bush-era tax cuts expire for those making $1 million or more; Mr. Obama had offered changing the top threshold to $400,000, as opposed to the current $250,000 threshold.

The crucial issue in today's meeting is the tax threshold, CBS News Chief White House Correspondent Major Garrett reports. Boehner and McConnell are united in opposition to the $250,000 threshold and nothing will move if Mr. Obama holds firm with his party on letting the tax rates expire on that level of income.

However, Garrett reports, McConnell is ready to deal and has Republican support to strike a deal in the $500,000 range or slightly higher.

Also, there are side discussions to include a variety of “patches” for the Alternative Minimum Tax, the doc fix (Medicare reimbursement rates shrink by 27 percent on Jan. 1) and jobless benefits, which expire tomorrow.

If the Republicans can budge Obama up to $500,000, a small tax deal with the side fixes may be doable. Republicans say it's all up to Obama's flexibility; the White House says it's all up to the GOP to guarantee up or down votes.

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