Obama is ready to play hardball, his allies say. He’s prepared to veto legislation to block the “fiscal cliff” unless Republicans allow the Bush-era tax cuts to expire for those making more than $250,000 a year, the White House says. Because he won reelection, the president may be able to dictate the terms of a bipartisan debt-reduction deal, The Washington Post’s Lori Montgomery reports. 
 
 President Obama Obama is ready to play hardball, his allies say. He’s prepared to veto legislation to block the “fiscal cliff” unless Republicans allow the Bush-era tax cuts to expire for those making more than $250,000 a year, the White House says. Because he won reelection, the president may be able to dictate the terms of a bipartisan debt-reduction deal, The Washington Post’s Lori Montgomery reports. Jonathan Ernst/Reuters 
 
 With the election behind them, Obama and lawmakers have turned their attention to the fiscal cliff. Here’s a look at some of the leaders who will influence whether the country can avoid falling off the cliff. 
 
 Negotiations to avert the year-end “fiscal cliff” advanced at a glacial pace Wednesday. Here’s a look at some of the leaders in the fiscal-cliff debate. 
 
 Negotiations to avert the year-end “fiscal cliff” advanced at a glacial pace Wednesday. Here’s a look at some of the leaders in the fiscal-cliff debate. 
 
 President Obama offered Republicans a detailed plan Thursday for averting the year-end “fiscal cliff” that calls for $1.6 trillion in new taxes, $50 billion in fresh spending on the economy and an effective end to congressional control over the size of the national debt. 
 
 The proposal, delivered to the Capitol by Treasury Secretary Timothy F. Geithner, mirrors previous White House deficit-reduction plans and satisfies Democrats’ demands that negotiations begin on terms dictated by the newly-reelected president. 
 
 The offer lacks any concessions to Republicans, most notably on the core issue of where to set tax rates for the wealthiest Americans. After two weeks of talks between the White House and aides to House Speaker John A. Boehner (R-Ohio), it seemed to take Republicans by surprise. 
 
 Boehner quickly rejected the proposal and was trying late Thursday to decide how to respond, aides said. After meeting with Geithner for about 45 minutes Thursday morning, the speaker announced his frustration with a negotiation process in which nearly three weeks have lapsed since the election with “no substantive progress.” 
 
 “I’m disappointed in where we are, and disappointed in what’s happened over the last couple weeks,” Boehner told reporters. “Going over the fiscal cliff is serious business. And I’m here seriously trying to resolve it. And I would hope the White House would get serious as well.” 
 
 Senate Minority Leader Mitch McConnell (R-Ky.) called the proposal a “step backward” from compromise — with time running out for policymakers to agree on a plan to prevent more than $500 billion in tax increases and spending cuts that could rattle the economy. 
 
 “This is a real problem. Every day, the delay brings us one step closer to the fiscal cliff that we simply must avoid,” McConnell said. 
 
 Democratic leaders, meanwhile, were triumphant after receiving similar briefings from Geithner and White House legislative liaison Rob Nabors. Top Democrats have for months insisted that an Obama victory would entitle them to demand far more in new taxes than Republicans have been willing to consider, to seek new measures to boost economic growth, and to avoid major cuts to entitlement programs, such as Social Security and Medicare. 
 
 “Democrats are on the same page,” said Senate Majority Leader Harry M. Reid (D-Nev.). “The president has made his proposal; we need a proposal from them.” 
 
 Although the White House offer seemed to startle Republicans, it contains little that would be unfamiliar to anyone following the president’s recent public statements. The exception was his proposal on the federal debt limit. GOP aides said Obama is seeking to permanently enact procedures that were temporarily adopted in the summer of 2011 that allow the White House to unilaterally increase the debt ceiling unless two-thirds of lawmakers disapprove. 
 
 That process, initially proposed by McConnell, was not intended to become permanent. By trying to make it so, Obama is seeking to avoid another damaging battle over the debt ceiling that would again risk a national default. However, this change would also deprive Congress of its historic authority over federal borrowing. 
 
 Unless Congress acts on the fiscal cliff, taxes will rise significantly in January for nearly 90 percent of Americans, and about $65 billion will be sliced out of the Pentagon and other agency budgets, probably triggering a recession. Simply canceling the changes, however, risks undermining confidence in the nation’s ability to manage its rising debt. 
 
 View Graphic What going over the 'fiscal cliff' would mean . . . 
 
 Financial markets, which in recent weeks have been optimistic about the prospects of a deal to replace the cliff with a less traumatic deficit-reduction plan, were whipsawed by Thursday’s declarations. The Dow Jones Industrial Average took a nose-dive during Boehner’s 11:30 a.m. news conference, dropping nearly 60 points in eight minutes. It closed up nearly 37 points, or 0.3 percent. 
 
 Obama’s offer comes nearly two weeks after Boehner and other congressional leaders opened talks at the White House. Since then, administration officials have negotiated directly with Boehner’s staff. Senior Republican aides said relations deteriorated in recent days, prompting Boehner to call the White House on Wednesday evening to request to speak with the president. 
 
 Boehner’s aides declined to comment on the 28-minute call, but Republicans in the Capitol said Obama dominated the conversation and was forceful in demanding that Boehner pass legislation to maintain tax rates for the middle class and let them rise on income over $250,000 a year. 
 
 Boehner called the discussion “frank and direct” and said he remains “hopeful that productive conversations can be had in the days ahead.” But both sides confirmed that no additional meetings have been planned but emphasized that talks will continue. 
 
 Obama’s proposal, as outlined by Republicans, would purportedly trim the debt by about $4 trillion over the next decade, in part through spending cuts already in force and savings from ending the wars in Iraq and Afghanistan. Also included are $1.6 trillion in taxes and about $400 billion in savings from changes to federal health and entitlement programs. 
 
 With regard to taxes, the White House wants about $1 trillion in new revenue from the year-end expiration of the George W. Bush-era tax cuts on income over $250,000. Obama also is demanding that dividends be taxed as normal income and that the estate tax be raised to 45 percent and expanded to cover estates worth as little as $3.5 million — policies for which the Democratic Senate was unable to win approval earlier this year. 
 
 The rest of the tax increases and the entitlement savings would come next year, through congressional revisions to the tax code and retirement programs. 
 
 The White House proposal would delay automatic cuts at federal agencies for one year while funding other Democratic priorities, including $50 billion for a new infrastructure bank and additional benefits for unemployed workers. 
 
 The plan also calls for extending the payroll tax cut, or adopting a similar tax break for working families, in addition to extending income tax cuts for the vast majority of taxpayers. 
 
 “Right now, the only thing preventing us from reaching a deal that averts the fiscal cliff and avoids a tax hike on 98 percent of Americans is the refusal of congressional Republicans to ask the very wealthiest individuals to pay higher tax rates,” White House spokeswoman Amy Brundage said. “We remain willing to do tough things to compromise, and it’s time for Republicans in Washington to join the chorus of other voices . . . who support a balanced approach that asks more from the wealthiest Americans.” ||||| Beneath the outward shows of frustration and rancor, Democrats said a deal could still be reached before hundreds of billions of dollars in automatic tax increases and spending cuts go into effect, threatening the fragile economy. Senator Charles E. Schumer, Democrat of New York, pointed to conservative Republicans who have suggested that the House quickly pass Democratic legislation in the Senate extending the expiring tax cuts for income below $250,000. 
 
 “All you have to do is just listen to what’s happening out there and you realize there is progress,” he said. 
 
 But publicly, the leaders of neither side were giving an inch. And Republican aides said the details of the White House proposal pointed to a re-elected president who believes he can bully Congress. 
 
 “They took a step backward, moving away from consensus and significantly closer to the cliff,” said Senator Mitch McConnell of Kentucky, the Republican leader. 
 
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 The president’s proposal does stick to the broad framework of the deal Mr. Boehner wants: an upfront deficit-reduction “down payment” that would serve to cancel the automatic tax increases and spending cuts while still signaling seriousness on the deficit, followed by a second stage in which Congress would work next year on overhauling the tax code and social programs to secure more deficit reduction. 
 
 But the details show how far the president is ready to push House Republicans. The upfront tax increases in the proposal go beyond what Senate Democrats were able to pass earlier this year. Tax rates would go up for higher-income earners, as in the Senate bill, but Mr. Obama wants their dividends to be taxed as ordinary income, something the Senate did not approve. He also wants the estate tax to be levied at 45 percent on inheritances over $3.5 million, a step several Democratic senators balked at. The Senate bill made no changes to the estate tax, which currently taxes inheritances over $5 million at 35 percent. On Jan. 1, the estate tax is scheduled to rise to 55 percent beginning with inheritances exceeding $1 million. 
 
 Administration negotiators also want the initial stage to include an extension of the payroll tax cut or an equivalent policy aimed at working-class families, an extension of a business tax credit for investments, and the extension of a number of other expiring business tax credits, like the one on research and development. 
 
 To ensure that there are no more crises like the debt ceiling impasse last year, Mr. Geithner proposed permanently ending Congressional purview over the federal borrowing limit, Republican aides said. He said that Congress could be allowed to pass a resolution blocking an increase in the debt limit, but that the president would be able to veto that resolution. Congress could block a higher borrowing limit only if two-thirds of lawmakers overrode the veto. 
 
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 In total, Mr. Geithner presented the package as a $4 trillion reduction in future deficits, but that too was disputed. The figure includes cuts to domestic programs agreed to last year that the White House put at $1.2 trillion but that Republicans say is about $300 billion less. And it counts savings from ending the wars in Iraq and Afghanistan, even though no one has proposed maintaining war spending over the next decade at the current rate. 
 
 “Listen, this is not a game,” Mr. Boehner said. “Jobs are on the line. The American economy is on the line. And this is a moment for adult leadership.” 
 
 Senate Democratic leaders left their meeting with Mr. Geithner ecstatic. If the Republicans want additional spending cuts in that down payment, the onus is on them to put them on the table, said Senator Harry Reid of Nevada, the Democratic leader.
– Details are emerging on Treasury secretary Tim Geithner's trek to Capitol Hill today to present the White House's wish list in the fiscal cliff talks, a move that "in some sense amounts to a formal start of negotiations," reports the Wall Street Journal. The short version seems to be that he asked for a lot—the proposal was "loaded with Democratic priorities and short on detailed spending cuts," says the New York Times—and Republicans let him know it. "No substantive progress has been made in the talks between the White House and the House over the last two weeks," complained John Boehner afterward. Added Mitch McConnell: The White House has taken a "step backward." Some highlights of what Geithner requested, from the Times, Journal, and Washington Post: No more debt ceiling—Congress would no longer need to approve an increase in the federal borrowing limit. It could try to block one, but the president would be able to veto. $1.6 trillion in tax increases over 10 years, including an immediate increase in rates for the richest Americans. (Politico says the final figure will be closer to $1.2 trillion once all the "huffing and puffing" is over.) $400 billion in savings over a decade from Medicare and other entitlement programs. $50 billion in new stimulus spending on infrastructure. Extensions of the payroll tax holiday and emergency jobless benefits.