(Corrects party affiliation of Burgess from Democrat to
Republican in paragraph 16)
* House Speaker Boehner to speak at 10 a.m. (1500 GMT
* Global markets weak as "fiscal cliff" talks stall
* Boehner's leadership criticized by some Republicans
* Democrats say they're ready to work on path forward
By Thomas Ferraro and Rachelle Younglai
WASHINGTON, Dec 21 The task of picking up the
pieces of the "fiscal cliff" talks - and reassuring global
financial markets that were shaky early on Friday - is likely to
fall largely to President Barack Obama after Republicans
abandoned their own proposed fix championed by House of
Representatives Speaker John Boehner.
Boehner, the top Republican in Congress and Obama's chief
negotiating partner, failed to muster enough support from his
fellow Republicans, who control the House of Representatives, to
pass his bill called "Plan B" on Thursday.
He had hoped to use it to pressure Obama in talks to avert
the steep tax hikes and automatic government spending cuts
slated to start taking effect in just 11 days.
Boehner late on Thursday abruptly pulled the legislation,
which would have raised taxes only on people earning $1 million
or more a year. House members, heading to their home states for
the holidays, were instructed to be available on 48 hours notice
With his power apparently weakened, Boehner scheduled a news
conference for 10 a.m. (1500 GMT) Friday. Democrats were urging
him to go back to the bargaining table with Obama.
"They went from Plan B to plan see-you-later," Obama adviser
David Axelrod said on MSNBC on Friday morning.
Obama said he still plans to work with Congress and was
hopeful for a bipartisan solution, his press secretary said in a
statement late on Thursday.
The failure casts fresh uncertainty over talks to avoid
across-the-board tax hikes and spending cuts that could push the
U.S. economy into recession in 2013.
Global stock markets weakened on Friday and both the euro
and gold slipped as the new setback rattled investors' nerves.
Most major stock markets saw widespread selling as investors
moved to traditional safe-haven assets.
The crumbling of Boehner's plan highlights his struggle to
lead some House Republicans who flatly reject any deal that
would increase taxes on anyone.
Republican Representative Tim Huelskamp criticized Boehner's
handling of the negotiations, saying the speaker had "caved" to
Obama opening the door to tax hikes. Huelskamp, a dissident
first-term congressman, said he was not willing to compromise on
taxes even if they are coupled with cuts to government spending.
Conservatives "are so frustrated that the leader in the
House right now, the speaker, has been talking about tax
increases. That's all he's been talking about," Huelskamp said
on MSNBC on Friday morning.
"There's been very little outreach by this leadership team
to conservatives. ... Do not ask for tax increases. We're not
going to give them," Huelskamp said, added: "We can still get
Obama and his fellow Democrats in Congress are insisting
that the wealthiest Americans pay more in taxes in order to help
reduce high federal budget deficits.
Democrats, who are the minority in the House but control the
Senate, are now stepping up efforts to gather some Republican
votes for a Democratic bill passed by the Senate months ago that
would extend the expiring tax cuts to all but the wealthy.
'READY TO WORK'
"What we'll have to do is figure out where that line is that
gives us those 218 votes" needed to garner a majority of the
House behind legislation, Republican Representative Michael
Burgess said on CNBC on Friday.
"I believe we can and must take action before the end of the
year to prevent the fiscal cliff," Steny Hoyer, the second
ranking Democrat in the House, told MSNBC. "Democrats are ready
to work with Republicans to do so."
Senate Republican Leader Mitch McConnell, who has
experience helping to forge deals when House Republicans are in
disarray, is likely to play a larger role now in attempting to
rescue the situation along with other Senate Republicans, who
have been more receptive to compromising.
Wall Street and numerous chief executives have expressed
frustration with Washington and the wrangling over a deal that
has persisted for weeks with little progress.
Aetna Inc Chief Executive Officer Mark Bertolini
said he feels negotiations seem like they are falling apart,
calling the back-and-forth among politicians "pitiful and
embarrassing" in the Wall Street Journal on Friday.
"The worst-case scenario is increasingly becoming a probable
scenario," BlackRock Inc Chief Executive Officer
Laurence Fink told the newspaper.
Sean West, a Eurasia Group analyst, told Reuters: "Boehner
didn't have a ton of good moves, and has even fewer now." He
said he thought Boehner was "either headed back to the White
House for a big deal or he's accepting whatever bipartisan
fallback is crafted by Senate leaders. Hard to see him coming
back with another partisan gambit."
(Additional reporting by Richard Cowan and Susan Heavey;
Editing by Fred Barbash and Will Dunham)