The plan serves twin purposes: to provide Republicans much-needed cover in the event that Congress can't avoid all the austerity measures that take effect next year; and to apply some pressure to President Obama to provide more revenue and spending concessions to Republicans in broader budget negotiations.
Leading Democrats -- including, notably, Sen. Chuck Schumer (D-NY) and House Minority Leader Nancy Pelosi -- have in the recent past proposed setting the threshold for the expiration of the Bush tax cuts at incomes above $1 million. "Plan B" is, in a similar spirit, designed to rob Democrats of their argument that Republicans are holding middle-income tax cuts hostage for millionaires and billionaires.
The plan reflects just how far the ideological pendulum has swing back in Obama's direction since the election. Republicans are now in effect siding with Schumer in what used to be a fight between top Democrats. But with leverage on their side, Democrats are preemptively rejecting the GOP's fallback.
"Speaker Boehner's 'plan B' is the farthest thing from a balanced approach," said Senate Majority Leader Harry Reid (D-NV). "It will not protect middle class families because it cannot pass both Houses of Congress. The Senate bill is the only 'plan B' that can be signed into law and prevent taxes from rising by $2,200 on the average middle-class family. Now is the time to show leadership, not kick the can down the road. Speaker Boehner should focus his energy on forging a large-scale deficit reduction agreement. It would be a shame if Republicans abandoned productive negotiations due to pressure from the Tea Party, as they have time and again."
House Minority Whip Steny Hoyer (D-MD) -- who controls Democratic votes in the House -- said House Dems won't provide Boehner cover. "The math doesn't work," he told reporters Tuesday. "We're going to urge our members to vote no."
The bill, which Republicans hope to bring to the floor later this week, would also likely patch the alternative minimum tax, to prevent it from hitting millions of middle-income earners, and the estate tax, which is scheduled to increase significantly next year. It would not roll back the sequester, and probably wouldn't extend expiring unemployment benefits either, but could include a "doc fix" to prevent Medicare physician reimbursements from dropping by a quarter.
"We'll continue to look at how we'd address those issues as we put this bill together," Boehner said.