This should explain why Obama refuses to negotiate:
The President is a scholar of legal history and Constitutional jurisprudence; a man keenly aware of the precedent he sets for future Presidents.
Obama understands what few in the press are pointing out: that it's not just that Republicans are taking the country and world economy hostage in order to prevent people from getting healthcare or in order to cut Social Security and Medicare. That's bad enough, obviously. But they're also threatening to overturn the very structure of the United States government, rendering the President an essentially superfluous rubber stamp to the will of Congress in general, and the House of Representatives in particular.
If the Republicans succeed in securing ransom for their hostages, it will destroy the veto power of the Presidency. From that moment onward, any dispute between the White House and the House of Representatives would be definitively resolved in favor of the latter whenever the next budgetary or debt ceiling cycle came due. It would be a radical reinterpretation of government far more extreme than the filibuster.
Even if the President were willing to throw every legislative priority overboard, he would not have his lasting legacy be the destruction of the power of the Presidency. That is why he is standing firm on his commitment to negotiate, but only when the threat of duress has been removed. To protect not just his Presidency but the office of the President itself, he has no choice left.
House Rapeublicans refuse (can't/won't) to accept that Obama and Reid will not negotiate under duress.
Indeed, these fiscal matters were decided during last year's election, when Obama/dems beat the snot out of Romney/repukes....in a victory so crushing as to be called a mandate.