(WASHINGTON) — Treasury Secretary Timothy Geithner on Wednesday said the Obama administration is “absolutely” prepared to go off the looming “fiscal cliff” if Republicans do not agree to raise tax rates on the wealthy.
Appearing on CNBC, Geithner was asked if the administration is willing to accept the impending spending cuts and tax increases if Republicans refuse to raise rates on the top 2 percent of income-earners as President Obama is demanding.
“Oh, absolutely,” Geithner replied. “There’s no prospect for an agreement that doesn’t involve those rates going up on the top 2 percent of the wealthiest.”
“What we’re trying to do is put in place a comprehensive, balanced set of fiscal reforms that put us back on the path of living within our means,” he explained when asked why the administration would be willing to go off the cliff, which experts say could trigger a recession.
“The size of the problem in some sense is so large it can’t be solved without rates going up,” he added.
Despite the ongoing standoff between the White House and Capitol Hill, Geithner said Republicans are “making a little bit of progress” and appeared optimistic that a deal will be reached in time.
“I think there’s very broad recognition that rates are going to go up as part of a deal,” he said. “I think there’s been some progress and I think we’re going to get there.”
Copyright 2012 ABC News Radio
Brian Stelter, CNN Money
Stephen Collinson, CNN Newswire