Liberals Chafe at White House Fiscal Cliff Proposals

Obama concedes ground to GOP on Social Security, threshold for tax increases.

President Barack Obama arrives at The Archdiocese of New York's 67th Annual Alfred. E. Smith Memorial Foundation Dinner, Thursday, Oct. 18, 2012, at the Waldorf Astoria Hotel in New York.
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Progressives groups, disappointed by President Barack Obama's latest fiscal cliff proposal, which was rejected by House Speaker John Boehner on Monday, are threatening to push rank-and-file Democrats to oppose certain provisions of his pitch.

Obama, making real concessions to Republicans, proposed a Social Security change that would result in decreased benefits for people as they age and raised the income level for which increased tax rates would apply, from $250,000 a year to $400,000. Both moves run counter to his initial preferences for inking a deficit reduction deal, but serve as a signal to Republicans he's willing to move closer to their proposals in exchange for their increasing willingness to raise income tax rates on the country's wealthiest.

"If such a deal were proposed by the president and Speaker, MoveOn members would expect every Senate and House Democrat to do everything in their power to block it," said Justin Ruben, executive director of Moveon.org, a liberal group, according to The Hill.

[ENJOY: Political Cartoons on the Fiscal Cliff]

David Callahan, senior fellow at Demos, a progressive policy advocacy group, says there's no doubt linking Social Security benefits to chained Consumer Price Index is a spending cut that would impact vulnerable groups.

"Lots of progressives and groups who represent seniors are pretty rightly disturbed that middle- and low-income seniors will be feeling pain as far as the solution here," he says. "People making $300,000 will continue to pay the lowest tax rates that they've paid in decades while seniors who get $900 a month for Social Security feel some pain. That doesn't seem right to me."

But House Minority Leader Nancy Pelosi told MSNBC's Andrea Mitchell on Tuesday her caucus would stick with the president under his latest pitch, despite the outside grumbling.

[RELATED: GOP Gets Behind Boehner's 'Plan B']

White House spokesman Jay Carney said the new proposal shows Obama's "evident willingness to meet the Republicans halfway."

The president won't accept a deal that will "shift the burden unduly onto seniors and the middle-class," Carney said during his daily briefing.

Michael Linden, director for Tax and Budget Policy at the Center for American Progress, says he's not shocked by the president's latest offer, but thinks it means the two sides are closing in on their final pitches.

"The president really is trying very hard to meet Speaker Boehner more than halfway on these issues and it remains to be seen if the speaker can even bring his caucus to the 30-yard-line," he says. "I know that progressives are not thrilled with the chained CPI, I don't think by itself would derail a deal for Democrats. But I do think the president has gone pretty far and I don't know how much further he could go."

[READ: The Top 10 Political Gaffes of 2012]

Boehner, who rejected the Obama deal saying it asked for too much in increased revenue and too little in spending cuts, also indicated the two sides were nearing the end of negotiations. On Tuesday, he offered a "Plan B" proposal, which would extend the current Bush-era tax rates to people earning up to $1 million a year in the event that a broader agreement could not be made before the New Year.

"We all know that every income tax filer in America is going to pay higher rates come January 1 unless Congress acts," Boehner said during a press briefing. "So I believe it's important that we protect as many American taxpayers as we can. Our Plan B would protect American taxpayers who make $1 million or less, and have all of their current rates extended."

Democrats in the House and Senate said they would not support such a plan. Instead, they propose that Boehner take up a measure, already passed by the Senate, which would keep rates as they are for those earning up to $250,000 a year.

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  • Rebekah Metzler is a political writer for U.S. News & World Report. You can contact her at rmetzler@usnews.com or follow her on Twitter.