Budget talks reach an impasse

Rep. Eric Cantor holds a news conference on Capitol Hill.

STEVE CHIOTAKIS: House Speaker John Boehner said this morning a tax increase will not pass the U.S. House. That's after Majority Leader Eric Cantor pulled out of budget talks with the White House today. So that leaves the debt ceiling question up in the air.

Marketplace's Nancy Marshall Genzer is with us live from Washington. Good morning, Nancy.

NANCY MARSHALL GENZER: Good morning Steve

CHIOTAKIS: What happened? Why did Cantor walk out?

MARSHALL GENZER: He says the negotiators, led by Vice President Joe Biden, had been able to finesse the tax question -- until now. Cantor says they're getting down to the nitty gritty. And Republicans are rejecting any suggestion that taxes should be raised.

Here's House Speaker John Boehner -- speaking just a few minutes ago.

JOHN BOEHNER: Tax hikes are off the table. If you raise taxes that we need to grow our economy and hire new workers, guess what? They're not going to do it if they have to pay higher taxes to the federal government.

Democrats say it's not fair for them to be asked to accept deep cuts in programs for the poor, without increasing taxes on wealthy Americans. They also want to eliminate some tax breaks for corporations, including oil companies and hedge funds.

CHIOTAKIS: This isn't a big surprise -- we knew it wouldn't be easy. How big of a stalemate is this?

MARSHALL GENZER: Steve, Cantor says it's very big. More talks are scheduled for this afternoon. Cantor of course won't be there. He says it's time for President Obama to step in and take over. Everybody expected that would happen,just not this soon. Congressional Democrats are meeting with the president at the White House today. They're going to be talking about their next step.

CHIOTAKIS: Thanks. All right, Marketplace's Nancy Marshall-Genzer reporting live. Thanks Nancy.

MARSHALL GENZER: You're welcome.

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