Day of Seesaw Talks Produces No Accord on Fiscal Crisis

In seesaw negotiations, the two sides got closer on the central issue of how to define the wealthy taxpayers who would be required to pay more once the Bush-era tax cuts expire.

But that progress was overshadowed by gamesmanship. After Republicans demanded that any deal must include a new way of calculating inflation that would mean smaller increases in payments to beneficiaries of programs like Social Security, Democrats halted the negotiations for much of the day.

The Republican leader in the Senate, Mitch McConnell, made an emergency call to Mr. Biden in hopes of restarting negotiations, and the White House sent the president’s chief legislative negotiator to the Capitol to meet with Senate Democrats. Soon after, Republicans withdrew their demand and discussions resumed, but little progress was made.

Lawmakers will be back on Monday. Senator Harry Reid of Nevada, the majority leader, said the Senate would return at 11 a.m. Monday and then left the Capitol just after 6 p.m.

“Talk to Joe Biden and McConnell,” Mr. Reid told reporters when asked if negotiations were continuing.

In the balance are more than a half-trillion dollars in tax increases on virtually every working American and across-the-board spending cuts that are scheduled to begin Tuesday. Taken together, they threaten to push the economy back into recession.

“It looks awful,” said Senator Richard J. Durbin of Illinois, the second-ranking Democrat. “I’m sure the American people are saying, with so much at stake why are they waiting so late to get this done?”

Senator Lindsey Graham, Republican of South Carolina, who had said early Sunday that he thought a deal was within reach, said later on his Twitter feed, “I think we’re going over the cliff.”

Weeks of negotiations between President Obama and Speaker John A. Boehner inched toward a deal to avert the so-called fiscal cliff, while locking in trillions of dollars in deficit reduction over 10 years and starting an effort to overhaul the tax code and entitlement programs like Medicare. But earlier this month, Mr. Boehner walked away from those talks.

Instead he tried to reach a much more modest deal to avoid a fiscal crisis by extending the expiring tax cuts for incomes under $1 million. When Mr. Boehner’s own Republican members revolted, he ceded negotiations to the Senate. But compromise has proved equally elusive in that chamber.

Absent a last-minute deal, Mr. Reid is expected to move on Monday to bring to a vote a stopgap measure pushed by Mr. Obama, which would retain lower tax rates for incomes below $250,000 and extend unemployment benefits. But it was not clear that would even get a vote. The objection of a single senator on Monday would run out the clock on the 112th Congress before a final tally could be taken.

Mr. Obama appeared on the NBC program “Meet the Press” on Sunday and implored Congress to act. “We have been talking to the Republicans ever since the election was over,” Mr. Obama said in the interview. “They have had trouble saying yes to a number of repeated offers.”

He added, “Now the pressure’s on Congress to produce.”

After the talks broke down over the inflation demand, Senate Republicans emerged from a closed-door meeting on Sunday afternoon to declare the issue off the table for now. Senator John McCain, Republican of Arizona, said that holding the line against raising taxes on high-income households while fighting for cuts to Social Security was “not a winning hand.”

Then they mustered a new talking point, saying Democrats want to raise taxes only to spend more money. Their new objection: Democrats are seeking a one- to two-year “pause” for across-the-board spending cuts and an extension of expired unemployment benefits for two million people.

“We raise taxes, and we spend more?” asked Senator Kay Bailey Hutchison, Republican of Texas. “It’s business as usual.”

For their part, Democrats beat back the inflation proposal, and then promptly proclaimed themselves incensed that Republicans would not soften their position on a generous level of taxation on inherited estates and an insistence that a final deal permanently prevent the alternative minimum tax, a parallel tax system meant to ensure that wealthy people pay more, from expanding to affect more of the middle class.

Democrats were also demanding that across-the-board cuts to military and domestic programs — known as the “sequester” — at least be delayed.