Treasury Secretary Timothy Geithner made the rounds on Capitol Hill, presenting a package calling for a $1.6 trillion tax increase, a $50 billion economic-stimulus program and new power to raise the federal debt limit without congressional approval, The Wall Street Journal reported.
The proposal stands firm on Obama's desire to allow Bush-era tax cuts on the wealthiest 2 percent of taxpayers to expire and postpones draconian spending cuts approved by Congress 18 months ago.
Without congressional action, on Jan. 1 George W. Bush-era tax cuts expire and draconian mandatory budget cuts kick in, a combination economists warn will send the U.S. economy back into recession.
Both House Speaker John Boehner, R-Ohio, and Senate Minority Leader Mitch McConnell, R-Ky., panned the offer.
"No substantive progress has been made in the talks between the White House and the House during the past two weeks," Boehner told a news conference.
"I'm disappointed in where we are and in the last couple of weeks."
In a written statement, McConnell was even more negative, accusing the administration of taking "a step backward, moving away from consensus and significantly closer to the cliff, delaying again the real, balanced solution that this crisis requires."
Boehner said Obama needs to outline spending cuts to jump-start the talks, something press secretary Jay Carney said the president already has done.
At the daily briefing, Carney said it's time for Republicans to get more realistic.
"The president will not sign any legislation that extends the Bush-era tax cuts for top earners in this country," Carney said.
"This should not be news to anyone on Capitol Hill. It is certainly not news to anyone in America who was not in a coma during the campaign season, because this was an explicit, repeated, and high-profile debate throughout the campaign."
Boehner and Obama spoke by phone Wednesday night, a discussion Carney said lasted 28 minutes and was described as a frank exchange of ideas.
Boehner also described his discussion with Geithner as frank.
"All eyes are on the White House. The country doesn't need a victory lap, it needs leadership," Boehner said.
He said Obama was willing to consider limiting high-income tax deductions in exchange for not insisting tax rates above $250,000 a year rise. Republican leaders have said they were open to considering an end to some deductions.
Bowles also expressed pessimism a deal could be reached in Washington's current partisan climate, divided Congress and dwindling legislative calendar.
He put the chances of a deal by the end of the year at one in three.