House Speaker John A. Boehner (R-Ohio) stepped into the "super committee" stalemate, offering a new deficit reduction proposal that was swiftly rejected by Democrats as "laughable" because it failed to include substantial new revenues.
Hopes are dimming that the secretive committee will be able to strike a $1.5-trillion deficit reduction deal in the limited time remaining. Lawmakers who make up the panel continued meeting behind closed doors Friday and were expected to talk into the weekend.
The Republicans' latest offer was a package that would cut $640 billion off deficits over the decade– far below the committee's goal, but a fallback proposal that could at least make a down payment on reining in federal deficits and limit mandatory reductions.
The package included $542 billion in spending cuts and fees and $98 billion in savings from lower interest payments on the nation's debt, along with $3 billion in new tax revenue that would come from closing the loophole that allows a tax deduction for corporate jets.
"This was a balanced, bipartisan plan. The fact that it was rejected makes it clear that Washington Democrats won't cut a dime in government spending without job-killing tax hikes," said Boehner spokesman Michael Steel.
But a Democratic aide familiar with the talks dismissed the proposal as unworkable.
"This offer was not a serious attempt at compromise and it was immediately rejected," the aide said. "Democrats are still working to get a balanced deal that meets or exceeds the goal of $1.2 trillion and are hoping that Republicans have not walked away from that."
Both sides have indicated that even a partial deal would help limit automatic cuts across defense and domestic agencies that will be triggered in 2013 if the panel fails to reach its goal. But Democrats have insisted that any package balance spending reductions with new taxes on the wealthy – a position the GOP has largely rejected as it hopes to avoid substantial tax increases.
The 12-member committee faces a Monday deadline to post any proposal that can be approved no later than Wednesday.