Top Senate Dem to GOP: No tax cuts for rich

May 22, 2012 - 2:00 PM

WASHINGTON (AP) — Republicans will have to drop their insistence on retaining tax cuts for the rich and plans to reshape Medicare before there can be a bipartisan deal on controlling federal deficits and averting a wide-scale tax increase in January, the Senate's top Democrat said.

In a letter to GOP senators released Tuesday, Senate Majority Leader Harry Reid blamed congressional Republicans' "strict adherence to tea party ideology" for the two sides' failure to reach such a deal. Reid, D-Nev., also said the GOP's "blind adherence to tea party extremism is making it impossible" to reach compromise before the November presidential and congressional elections.

Reid's letter, dated Monday, was a response to one that 41 Republicans senators sent him last week. In it, they said Congress and President Barack Obama should act this year to avert an automatic increase in income and other taxes that will occur in January when tax cuts enacted a decade ago expire.

The letters represented the latest salvos between the parties as they appeal to voters and simultaneously maneuver for advantage in an upcoming year-end budget clash. In January, lawmakers will face the expiration of the tax cuts, the beginning of $1.2 trillion in automatic cuts in defense and domestic programs, and a need to renew the government's authority to borrow money.

Obama and Democrats have said they want to prevent income tax rates from rising for everyone but the wealthiest taxpayers, saying the rich must contribute their fair share to efforts to tame the enormous federal debt. Republicans want to keep taxes from rising on everyone, arguing that tax increases on the rich would curtail their ability to create jobs.

Last week, most Republicans voted in favor of beginning a Senate debate on a 2013 fiscal plan by House Budget Committee Chairman Paul Ryan, R-Wis. Ryan's budget would reconfigure Medicare into a voucher-like program in which most future beneficiaries would have to buy health insurance on the open market, rather than have the government pay many hospital and doctor bills as it does today.

"Once Republicans are willing to abandon their commitment to more tax breaks for multi-millionaires and special interests and their plans to end Medicare, I am confident that we can reach an agreement," Reid wrote.