WASHINGTON -- With President Barack Obama insisting on higher tax rates for affluent Americans and winning public support for the idea, congressional Republicans find themselves in an increasingly difficult political spot and are quietly beginning the difficult search for a way out.
Senior Republican leadership aides say they are contemplating a fallback position, since a standoff over expiring tax rates will be portrayed by Democrats as evidence that the opposition is willing to allow taxes to rise on the middle class to keep taxes from rising on the rich -- and their intransigence could mean that taxes go up on rich, poor and middle class alike.
The leadership officials now say that if no deal can be struck to avert the en masse expiration of all the Bush-era tax cuts and the onset of deep, across-the-board spending cuts, they could foresee taking up and passing legislation this month to extend the expiring middle-class tax cuts, then resume the bitter fight over spending and taxes as the nation approaches the next hard deadline: its statutory borrowing limit, which could be reached in late January or February.
"There's always better ground, but you have to get there," said Rep. Michael C. Burgess, R-Texas, who made clear that he does not support allowing any taxes to rise.
Maine Sen. Olympia J. Snowe, who is retiring, Tuesday joined a handful of fellow Republicans in suggesting that Congress should pass the middle-class tax cut extensions now, then leave the fight over taxes and spending until later. Americans, she said, "should not even be questioning that we will ultimately raise taxes on low- to middle-income people." Congress could take that off the table "while you're grappling with tax cuts for the wealthy," she said.
But any move toward compromise with Democrats on fiscal issues quickly comes under attack from conservatives as a surrender and unsettles the rank-and-file.
It is a dynamic that has haunted House Speaker John A. Boehner, R-Ohio, throughout the 112th Congress, as he has repeatedly been caught between the imperative to govern and the need to satisfy the restive right. Mr. Boehner has drawn fire this week for removing a handful of House Republicans who have defied leadership from their preferred committee seats, a step he took to enforce party discipline.
Mr. Obama made clear Tuesday in a Bloomberg News interview that he was not going to budge on raising tax rates on income above $250,000. "We're going to have to see the rates on the top 2 percent go up," the president said in his first interview since his re-election, "and we're not going to be able to get a deal without it."
The prospect of allowing an extension only of the middle-class tax cuts is just one possibility, and Congress may never reach that point if an agreement can be reached, or if another alternative can be found. And it would be a bitter pill for Republicans to swallow since they have repeatedly called for an extension of all the expiring tax cuts, saying any increases could harm the economy.
But Republicans also know they have a problem: Many liberal Democrats are more than willing to return to the Clinton-era tax code and allow across-the-board cuts -- disproportionately affecting the military -- to take effect, rather than compromise too much with Republicans after the strong Democratic elections showing.
"It's a terrible position because, by default, Democrats get what they want," said Rep. James Lankford, R-Okla., who admitted that his party is boxed in.
But in the debt-ceiling fight, the tables might turn. Many conservative Republicans say they are willing to let the nation default if Congress refuses to cut spending. If the tax-rate fight is already resolved by the time the debt-limit increase is needed, Democrats will find themselves without the leverage they now have with expiration of the lower tax rates.
Popular opinion seems to be running against the Republicans. Most Americans support higher taxes on the rich, and a poll released Tuesday by The Washington Post and the Pew Research Center found that 53 percent say Republicans would and should be blamed if Washington fails to reach a deal before January. Just 27 percent said Mr. Obama would deserve more blame, while 12 percent say both sides would share the blame equally.
Most Republicans do not want tax rates to rise on anyone, and such national polls have little sway over House members in districts drawn to favor one party over the other. In November, 204 Republicans -- 88 percent of the House Republican Conference -- won at least 55 percent of the vote, according to David Wasserman, a House analyst at The Cook Political Report. Thirty-five of them won at least 70 percent.
Mr. Boehner took as much fire from conservatives as from Democrats after proposing a deficit-reduction plan that would raise $800 billion in tax revenue over 10 years.
"One party proposes 800 billion in tax increases. In an effort to counter them and continue to be the 'low tax, small government' party, the other party's leadership proposes ... wait for it ... 800 billion in tax increases," Sen. Rand Paul, R-Ky., huffed on his Facebook page.
Given the difficulty of compromise, a fallback may emerge as a top option. Republican leaders could take up legislation already passed by the Senate to extend tax cuts on income under $250,000, attach a deferral or cancellation of the automatic spending cuts and give Mr. Obama nothing else -- denying requests for increased infrastructure spending, help for homeowners to refinance their mortgages, and extensions of the payroll tax cut and unemployment insurance.
Then Republicans would demand deep concessions on spending and changes to Medicare and Social Security as a price to raise the debt ceiling a few weeks later. Republicans say any such decision to follow that course is still a ways off.