Reid's plan evidently caught the GOP off guard and it took them some time to think about how they could reject it -- but reject it, they have. One reason for rejection, as outlined below, is to insist that only Paul Ryan can count money not spent in Iraq and Afghanistan as savings.
Matt Yglesias suggests that perhaps the GOP was never actually negotiating in good faith,
Republicans are rejecting this even though it nominally meets their demands. Why? Because it doesn’t achieve either of their two real objectives. In particular, the plan doesn’t cut Medicare, which means that Democratic party candidates for office in November 2012 and 2014 can accurately remind voters of the content of the Republican [Ryan] budget plan. In case you forgot, this plan repeals Medicare....It was only after voting for this plan that Republicans seem to have realized that repealing Medicare is unpopular. Since that time, they’ve been trying to entrap Democrats into reaching some kind of Medicare détente with them, which would immunize them from criticism [see for example here]. Reid’s plan doesn’t do that.In the spirit of fair and balanced reporting that is the hallmark of the non-partisan Ward Report, there are reports this morning that Obama might also be nixing Reid's deal.
Second, while Reid’s plan doesn’t raise taxes, it also doesn’t take tax increases off the table. Currently, the Bush tax cuts are scheduled to expire in 2012. If Reid’s all-cuts plan passes, that still leaves the door open to significant revenue increases. Now that doesn’t mean this is brilliant 11-dimensional chess. The Reid Plan is consistent with substantial revenues coming online in 2012, but that will only happen if President Obama and Senate Democrats stand firm and play hardball on the tax issue. Back in December 2010, they utterly failed to do so.