Boehner says bigger deal unlikely

NY Times:

Citing differences over tax revenues, House Speaker John A. Boehner said on Saturday night that he would pull back from joint efforts with President Obama to reach a sweeping $4 trillion deficit-reduction plan tied to a proposal to increase the federal debt limit.

On the eve of a second round of high-level bipartisan talks set for Sunday, Mr. Boehner issued a statement saying he would now urge negotiators to instead focus on crafting a smaller package more in line with the $2 trillion to $3 trillion in spending cuts and revenue increases negotiated earlier by Vice President Joseph R. Biden Jr.

“Despite good-faith efforts to find common ground, the White House will not pursue a bigger debt reduction agreement without tax hikes,” Mr. Boehner said. “I believe the best approach may be to focus on producing a smaller measure, based on the cuts identified in the Biden-led negotiations, that still meets our call for spending reforms and cuts greater than the amount of any debt limit increase.”

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One of Obama's problem is the type of revenue he is trying to get. He is trying a moral preening approach to increasing certain corporate taxes particularly on energy companies and relatively wealthy individuals. He is not going to persuade Republicans that this is fair or balanced. He is preaching to the liberal choir, but the conservative pews are empty for this sermon.

He could get a trillion dollars in increased revenue with thousands of new jobs if he would open up federal lands and offshore waters to oil and gas drilling. You can already see the effect of energy production in Texas and North Dakota where the Department of the Interior has little say in the decision to drill.

It would take overriding the carbon phobias within his party, but the rewards in terms of revenue and jobs would be significantly greater than any tax deal he could squeeze out of House Republicans.