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What Is Boehner's 'Plan B' Strategy & Why Did the White House Reject it?


"I think it's a terrible idea."

The White House on Tuesday rejected House Speaker John Boehner’s backup tax bill, dubbed “Plan B,” saying it “fails to meet President Barack Obama's call for a balanced approach and does not put enough of a tax burden on the wealthiest Americans,” Reuters reports.

"The president is hopeful that both sides can work out remaining differences and reach a solution so we don't miss the opportunity in front of us today," said White House Press Secretary Jay Carney.

Boehner had called for a separate bill to address only taxes. He wants lawmakers to extend tax cuts for people making up to $1 million. He also called for entitlement cuts and a tax reform debate next year.

"I continue to have hope that we can reach a broader agreement with the White House" that would cancel a wave of tax increases and spending cuts now poised to begin in early January, Boehner told reporters.

But he said when it comes to offering a package that balances tax increases with spending cuts, "The president is not there yet."

Here's a video of Reps. Boehner and Eric Cantor (R-Va.) introducing "Plan B":

For its part, the White House (via Press Secretary Jay Carney) said "Plan B" doesn't "ask enough of the very wealthiest in taxes and instead shifts the burden to the middle class and seniors."

Boehner spokesman Brendan Buck responded: "After spending months saying we must ask for more from millionaires and billionaires, how can they reject a plan that does exactly that?"

Buck continued, accusing President Obama of "moving the goal posts" and "threatening every American family with higher taxes."

And before the White House had even rejected Boehner's "Plan B," Senate Majority Leader Harry Reid (D-Nev.) was already assuring the press that it would never pass the senate.

"Speaker Boehner's 'plan B' is the farthest thing from a balanced approach," Senate Majority Leader Harry Reid's office said in a statement. "It will not protect middle class families because it cannot pass both Houses of Congress."

"Now is the time to show leadership, not kick the can down the road," Reid said. "Speaker Boehner should focus his energy on forging a large-scale deficit reduction agreement. It would be a shame if Republicans abandoned productive negotiations due to pressure from the tea party, as they have time and again."

In addition to allowing a tax increase for million-dollar earners, the Boehner plan would have prevented an expansion of the alternative minimum tax that would otherwise hit 28 million middle- and upper-class Americans with an average $3,700 increase on their 2012 tax returns.

So, yes, the Obama White House has rejected a plan that would've prevented an increase in taxes on the middle-class.

The plan would have also extended the current maximum 35 percent tax rate on inheritance, exempting the first $5 million. That tax rate is slated to rise to 55 percent on Jan. 1, with only a $1 million exemption.

Boehner aides said the call for a separate tax bill does not mean the Republican is cutting off negotiations with Obama on averting the full slate of tax hikes and spending cuts due to take effect next year. It's simply a "just in case" backup plan.

"In terms of logistics, the House is tentatively planning to take up the 'Plan B' proposal later this week, as early as Thursday. They would do it by amending a bill previously passed by the Senate that tracked more with Obama's original offer," Fox News reports.

"Then, the House would send the bill back to the Senate -- where it would likely sit as a potential last resort in case Obama and Boehner cannot strike a deal," the report adds.

Follow Becket Adams (@BecketAdams) on Twitter

The Associated Press contributed to this report. This post has been updated
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