President Barack Obama in a press conference on Wednesday, held to announce the formation of a committee headed by Joe Biden to suggest changes to legal possession of weapons, was asked repeatedly about the Fiscal Cliff legislation. He warned Republicans he would veto their "Plan B" plan to avert the looming Fiscal Cliff crisis, claiming it would dump pain disproportionately on the middle class.
The move came as hopes faded for an imminent deal to avert a year-end combination of tax hikes and huge spending cuts which some analysts fear could spark a new US recession and damage the fragile global economic recovery, as reported by AFP.
Republican House Speaker John Boehner framed the legislation, which would raise taxes on those earning more than $1 million, to counter Obama's fiscal plan, in case his talks with Obama on a broader plan to trim the US deficit by close to a trillion dollars do not bear fruit by the deadline.
His gambit was the latest move in a tense game of brinkmanship between the Democratic White House and Republican House of Congress, which has deep political ramifications for the balance of power in Washington during Obama's second term.
White House communications director Dan Pfeiffer said the Boehner plan meant that the wealthiest Americans would still benefit while students and families would lose critical tax cuts and health and unemployment benefits they need.
Pfeiffer said the plan would also "perversely" not include spending cuts that Republicans have demanded in talks with Obama.
"This approach does not meet the test of balance, and the President would veto the legislation in the unlikely event of its passage."
If Boehner and Obama do not reach a deal before the end of the year, George W. Bush-era tax cuts on all Americans will expire and taxes will go up.
Obama campaigned on renewing tax cuts for people earning less than $250,000 but has since moved the threshold in negotiations with Boehner up to $400,000.
Boehner spokesman Brendan Buck called what he said was the White House's opposition to a back-up plan "bizarre and irrational."
"In the absence of a 'balanced' solution from the president ... we must act to stop taxes from rising across the board in 12 days," he said.
Earlier this week, hopes were rising for a deal, but Boehner's decision to put a Plan B on the House floor has some observers wondering whether he can sell a deal with Obama to his own restive caucus.
White House officials privately say that they believe Obama has made significant compromises in search of a deal with Boehner, including agreeing to a Republican plan to calculate the impact of inflation on the Social Security retirement plan, which could slow the growth of benefits.