Obama: Let Bush-era tax cuts for the wealthiest expire

President Barack Obama calls on Congress to pass a one-year extension of Bush-era tax cuts on income of less than??

Sounding every bit like the candidate he is, President Barack Obama called Monday for a one-year extension of Bush-era tax cuts on annual income up to $250,000, while letting those that chiefly benefit the very wealthy expire on schedule at year's end. The proposal reignited an election-year fight designed to polish his credentials as a champion for middle-class Americans.

"It's time to let the tax cuts for the wealthiest Americans, folks like myself, to expire," he said in the East Room of the White House, surrounded by people he warned could see a $2,200 jump in their tax bill if the rates expire.?"I'm not proposing anything radical here," he insisted, casting the move as a return to the tax rates in force under President Bill Clinton, who presided over an era of robust job growth.

Obama's announcement echoed his core campaign message on the economy, the top issue on voters' minds. He did not refer to Mitt Romney by name, but tried to make the debate over the upper-bracket tax cuts central to the election.

"The fate of the tax cut for the wealthiest Americans will be decided by the outcome of the next election. My opponent will fight to keep them in place, I will fight to end them," he said. "The American people are with me on this."

Obama later vowed to veto legislation extending the tax cuts across the board. "I would veto it," he told Louisiana's WWLTV as part of a series of interviews with local and regional television anchors from eight states: Florida, Iowa, Kentucky, Louisiana, Nevada, New Hampshire, North Carolina and Wisconsin.

When it comes to the top earners, Obama added to WWLTV, "I'm happy to have that debate -- but no need to hold hostage most Americans who need some certainty right now."

Obama aides say they hope that the "tax fairness" argument will win over voters struggling in the fitful economy three and a half years after he took office vowing to fix it.

With national unemployment at 8.2 percent and little relief expected between now and Nov. 6, the Obama campaign has sought to convince struggling Americans that he has their best interests at heart. He has urged voters to see the election as a choice between his approach and Romney's, not as a referendum on his record.

The White House and Congress will face the tax-cut issue in earnest after the election, with the expiration looming. But even before Obama spoke, Republicans declared it dead on arrival.

"President Obama is still asleep at the switch when it comes to our economy and jobs," Republican House Speaker John Boehner said in a statement that mocked the initiative as "quixotic."

"How will these small business tax hikes create jobs? Even Democratic congressional leaders and former President Clinton have turned their back on this proposal," Boehner said. That was an apparent reference to Democratic House Minority Leader Nancy Pelosi and Democratic Sen. Chuck Schumer's call for extending the tax cuts that affect income below $1 million.

Romney's campaign also blasted the proposal, with spokeswoman Andrea Saul calling it "a massive tax increase" and saying "it proves again that the president doesn't have a clue how to get America working again and help the middle class."

"Unlike President Obama, Governor Romney understands that the last thing we need to do in this economy is raise taxes on anyone," Saul said in a statement emailed to reporters.

[Related: Compromise in Congress very unlikely]

The president's proposal would extend tax cuts on annual income up to $250,000. Americans making more would still see benefits up to that level. Obama has said that failing to raise taxes on the wealthiest will mean cash-strapped state and federal governments have to make deeper cuts to education, infrastructure and scientific research. ABC News, citing the Tax Policy Center, reported that raising taxes in line with the president's approach would affect 2.5 percent of small businesses, a total of 894,000 businesses.

Obama called the upper-bracket tax cuts "a major driver of our deficit" yet "the least likely to promote growth." And, he noted, "it's not like I like to pay taxes. I might feel differently if we were still in surplus."

Obama will press his message on a campaign trip to Iowa on Tuesday. And his re-election operation will host a series of events in other battleground states this week to amplify that theme.

The president signed legislation in December 2010 to extend all of the Bush-era tax cuts to the end of this year. But even then he made clear that he favored letting the reductions for the highest-income Americans expire. He has consistently said since then that the wealthiest should pay more in taxes. Republicans have cast this as Obama pushing a tax increase on investors, and warned that it will smother already weak job growth.

But Republican opposition may only boost the initiative's political value to the president, who has told voters that the chief obstacle to the recovery is a Republican-engineered "stalemate" in polarized Washington.

"The choice in this election is between the President's plan to build this economy from the middle class out, promoting job creation and reducing the deficit in a balanced way, or Mitt Romney's plan to return to the same top-down policies that crashed our economy and decimated the middle class in the first place," Obama campaign spokesman Ben LaBolt said in a statement. "Today, Mitt Romney made that choice even more crystal clear."

Several Democratic senators facing difficult re-election fights have signaled that they will break with the president on the issue. But?with Republicans pointing to Pelosi's past comments as evidence of a Democratic schism at the very top, a senior Democratic House aide told reporters by email that "Democrats support immediate extension of the middle-income tax cuts."

"Republicans are very clear: they continue to hold tax cuts for the middle class hostage to costly and unnecessary tax breaks for the wealthiest Americans, even though tax cuts for the rich have created more debt and won't produce jobs," the aide said on condition of anonymity. "Democrats say pass the extension of the middle income tax cuts now and end the uncertainty."

UPDATE, 6:30 p.m. EDT: This post has been updated with Obama's remarks to WWLTV.

Source: http://news.yahoo.com/blogs/ticket/obama-let-bush-era-tax-cuts-wealthiest-expire-172849154.html

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