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Broken Government

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Obama Needs More Money to Overcome Fiscal Cliff

November 14th 2012

Obama

President Obama is taking a tough opening stance in talks over deficit reduction, pushing Republicans to accept a plan that calls for $1.6 trillion in new tax revenue over the next ten years, according to reports.

The figure is double the $800 billion last discussed by the White House and House Speaker Boehner (R-Ohio) during their 2011 negotiations on raising the debt-ceiling limit.

The president’s plan is based on his most recent budget proposal, which sought the $1.6 in new revenues by targeting the wealthy and corporations.

The president and congressional lawmakers are set to meet at the White House on Friday as both sides begin hammering out a deficit-cutting plan that helps the nation move past the “fiscal cliff” of rising tax rates and automatic spending cuts set to take effect in January 2013.

Both sides say they hope to avoid the fiscal cliff, but are at an impasse over taxes, with the president insisting that the wealthy pay more.

Obama hopes to extend the expiring George W. Bush-era tax rates for those families making less than $250,000 per year. Republicans, though, say they want the rates extended across-the-board. 

 On Tuesday the president met privately with a number of union leaders and liberal activists to discuss his plan. In the meeting Obama reportedly promised to make good on his vow to renew low tax rates for the middle class and let them expire for wealthy households.

Obama will also meet with executives of some of the largest American companies, including Ford, General Electric and Wal-Mart, to sell his deficit-reduction plan on Wednesday. 

Republicans, led by Boehner, have said they are open to additional tax revenues in a deficit reduction deal but would not agree on to a plan centered around tax-rate increases.

GOP lawmakers insist that the White House include entitlement reform and spending cuts as part of any deficit package, but Obama has said he will only compromise if the deal includes higher taxes on the wealthy.

Both sides claim support from voters on tax policy after Election Day, which saw the president reelected, but Republicans, who have staunchly opposed any tax increases, holding on to the House.

Republicans, though, have yet to offer a specific figure to open talks, but Boehner has said he believes negotiations should begin at the $800 billion revenue mark discussed in 2011.

Daniel Strauss writes for The Hill, from where this article is adapted.


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