White House calls talk of tax cut deal ‘inaccurate and premature’

Jon Ward Contributor
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White House press secretary Robert Gibbs said Thursday that there is no deal imminent with Republicans on which tax cuts from the Bush administration era, calling reports of an agreement “inaccurate and premature.”

Gibbs issued the statement about an hour after the Democratic-controlled House passed an extension of the tax cuts for individuals making $200,000 a year or less and families with income of $250,000 a year or less.

Democrats acknowledge, however, that Senate Majority Leader Harry Reid, Nevada Democrat, does not have the votes to pass such a bill, which would let the current tax rates go up for those making above $200,000 and $250,000 a year.

Gibbs’s statement acknowledged this reality.

“The president continues to believe that extending middle class tax cuts is the most important thing we can do for our economy right now and he applauds the House for passing a permanent extension. But, because Republicans have made it clear that they won’t pass a middle class extension without also extending tax cuts for the wealthy, the president has asked [Budget] Director [Jack] Lew and Secretary [of the Treasury Tim] Geithner to work with Congress to find a way forward,” Gibbs said.

“Those discussions started just yesterday and are continuing this afternoon. The talks are ongoing and productive, but any reports that we are near a deal in the tax cuts negotiations are inaccurate and premature,” he said.

Lew and Geithner are negotiating with a bipartisan group of four lawmakers: Sen. Max Baucus, Montana Democrat, Sen. Jon Kyl, Arizona Republican, Rep. Chris Van Hollen, Maryland Democrat, and Rep. Dave Camp, Michigan Republican.

Some liberals interpreted the Gibbs statement as an admission of capitulation.

“Pelosi House passes middle class tax cuts. White House stabs her in the back,” wrote liberal blogger Markos Moulitsas, on his Twitter feed.

But the White House is bargaining to get a number of other items thrown into the bargain, such as an extension of unemployment insurance and a number of tax breaks, deductions and refunds.

Yet some liberal groups said Thursday that this was still unacceptable to them.

“At a moment when they could have celebrated victory, this White House incredibly chose to wave the white flag — signaling to Republicans that they will take any deal, no matter how bad, including borrowing billions to extend tax cuts for the richest Americans,” said Adam Green, with the Progressive Change Campaign Committee.

Green called the administration’s potential agreement to extend all tax cuts “a direct betrayal of a core Obama campaign promise, and the essence of political malpractice and negotiating incompetence.”

Green said the PCCC is going to increase its ad buy in Iowa, using Obama’s own promise to let the upper bracket cuts expire against him.

“This White House clearly needs more grassroots pressure to do the obvious thing — so tomorrow, we’ll be increasing our ad buy in Iowa telling Obama to keep his promise and fight the Republicans on this issue,” Green said.

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