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Obama Insists On Tax Hikes For Wealthy Americans

Nov 9, 2012
Originally published on November 16, 2012 12:17 pm



From NPR News, this is ALL THINGS CONSIDERED. I'm Robert Siegel.


And I'm Melissa Block. Today in Washington, D.C. more talk of the need for compromise to avoid the so-called fiscal cliff. And the surprise this afternoon, the resignation of CIA director David Petraeus after he admitted he had an extramarital affair. We'll talk more about Petraeus in a few minutes with our regular political commentators.

SIEGEL: First, to the policy challenge. As an initial step, President Obama has invited Republican and Democratic congressional leaders to the White House next Friday. The negotiations with Congress will be the first big test of whether the president can translate his electoral victory into political leverage. NPR's Scott Horsley has that story.

SCOTT HORSLEY, BYLINE: President Obama has stayed mostly out of sight since his election night party in Chicago, Tuesday. This afternoon, he stepped back into the spotlight with a carefully staged appearance before cheering supporters in the White House east room.

PRESIDENT BARACK OBAMA: Now that those of us on the campaign trail have had a chance to get a little sleep, it's time to get back to work and there's plenty of work to do.

HORSLEY: First on the to-do list is making a deal with Congress to prevent a big tax increase and a big spending cut from taking effect in January. Otherwise, the Congressional Budget Office warns the combination of higher taxes and reduced government spending would send the U.S. economy back into recession. Mr. Obama urged lawmakers in the Republican-controlled House to pass a Senate bill that would keep taxes low for families making less than a quarter million dollars.

He'd allow taxes to increase, though, on the wealthiest Americans, saying the government needs the extra money to help control the federal deficit.

OBAMA: We have to combine spending cuts with revenue and that means asking the wealthiest Americans to pay a little more in taxes.

HORSLEY: Congressional Republicans have long resisted any tax increase. Two years ago, in the wake of their own election victory, Republican lawmakers forced a reluctant president to extend Bush-era tax cuts for everyone, including top earners. Now that he's secured a second term, Mr. Obama thinks he has a stronger bargaining position.

OBAMA: This was a central question during the election. It was debated over and over again. And on Tuesday night, we found out that the majority of Americans agree with my approach, and that includes Democrats, Independents and a lot of Republicans across the country, as well as independent economists and budget experts. That's how you reduce the deficit.

HORSLEY: Exit polls show 60 percent of voters think taxes should go up, either on the wealthy or on everyone.

OBAMA: So our job now is to get a majority in Congress to reflect the will of the American people.

HORSLEY: Mr. Obama has some leverage because if Congress fails to act, taxes go up automatically for everyone. House Republicans continue to argue against raising tax rates on the wealthy, but Speaker John Boehner left the door open to raising tax revenue in other ways, like closing loopholes, for example, or limiting deductions.

REPRESENTATIVE JOHN BOEHNER: As you all know, the president and I, were attempting to deal with this problem a year and a half ago, there were revenues on the table.

HORSLEY: That deal fell apart when Mr. Obama pushed for a bigger tax increase and Boehner realized he might not be able to deliver House votes for even a small tax hike. Today, Boehner expressed confidence that if a deal can be struck, he'll bring his party along.

BOEHNER: Well, when the president and I have been able to come to an agreement, there's been no problem in getting it passed here in the House.

HORSLEY: Still, the White House is sensitive to the fine line Boehner has to walk with the more conservative members of this own caucus. And the administration will try to craft a deal that's politically palatable for both parties. Mr. Obama was adamant, though, that tax hikes on the wealthy must be part of any grand deficit-cutting bargain.

OBAMA: I'm not going to ask students and seniors and middle class families to pay down the entire deficit while people like me making over $250,000 aren't asked to pay a dime more in taxes. I'm not going to do that.

HORSLEY: A spokesman later reiterated Mr. Obama's threat to veto any extension of Bush-era tax cuts for the wealthy, suggesting that as scary as the fiscal cliff may be, the newly empowered president is not backing down. Scott Horsley, NPR News, Washington. Transcript provided by NPR, Copyright National Public Radio.