John Boehner's dilemma in fiscal cliff showdown

With room for manoeuvre slipping away, top US Republican John Boehner is in a bind over how to avoid going over the fiscal cliff: embrace higher taxes and earn conservatives' ire, or scupper a deal and incur Americans' wrath.

Another option, one that few non-partisans see as very viable, is for President Barack Obama to cave in and agree to Republican demands not to raise taxes, even for the wealthiest Americans.

A likelier resolution is a compromise with the White House that avoids the early January shock of automatic spending cuts coupled with tax increases on nearly all Americans, while laying out enough deficit reduction to ease concerns about the country's financial well-being.

In the game of political chicken to see whether Democrats or Republicans blink first, perhaps the trickiest role of all rests with Speaker of the House Boehner, who along with Obama is the principal in the negotiations.

Boehner's guidance of the Republican position in coming days and weeks could signal much about party direction in the wake of an election that saw flag-bearer Mitt Romney, who advocated slashing tax rates across the board, defeated by Obama.

"To say Boehner is between a rock and a hard place is minimising the problem he faces," said long-time political consultant and Boston University professor Tobe Berkovitz. "Boehner is trying to keep public opinion about Republicans from totally cratering, and at the same time keep the tea-party, hardcore conservatives from totally abandoning the party."

Conservative Republican Trent Franks agrees that "our speaker is in an enormously difficult position".

Few people other than Boehner and Obama know the true state of negotiations in what appears as a well-choreographed campaign to thrash out a last-minute deal. Discussions appear to have stalled, though, and Boehner has accused Obama of having "wasted another week" by not pushing talks forward.

Obama has proposed US$1.6 trillion in new taxes over the next decade from higher rates on the wealthiest 2 per cent of Americans. Republicans offered a plan for US$800 billion in tax revenue raised by closing loopholes and ending some deductions. Both plans were rejected.

Polls show most Americans want to see taxes rise on the wealthy. With Obama winning re-election on November 6, and his Democrats gaining seats in both branches of Congress, Republicans concede privately - and some publicly - that the Democrats have the upper hand.

"President Obama pretty well holds all the cards in this negotiation," Republican Senator Ron Johnson said.

A Washington Post/Pew poll showed 53 per cent of Americans would blame Republicans should the economy dive off the cliff; 27 per cent would blame Democrats. On Friday, Boehner left open the possibility for compromise on a tax rate rise. In past negotiations, such as December's battle over extending the payroll tax holiday, some Republicans felt Boehner gave away too much.

With conservatives demanding unity on taxes, Boehner faces the prospect of revolt from his right flank should he agree to a deal raising high-end rates.

Berkovitz said Republicans faced two options to avoid the cliff: negotiate and compromise, or hold their noses and "give Obama what he wants. If it goes south, take the election victory in two years and maybe four years."