President Barack Obama’s top spokesman hardened the White House’s position on taxes Thursday with a declaration aboard Air Force One that Obama “will not sign under any circumstances an extension of tax cuts for the top 2 percent of American earners.”
Jay Carney’s statement escalates the partisan fight over the impending fiscal shock caused by a synchronized imposition in January of tax increases and spending cuts.
“It is simply unacceptable to go back to policies that failed that stuck the middle class with the bill in order to give very expensive tax cuts to the wealthiest. … We can’t afford it,” he said during a press gaggle en route to New York to view storm damage.
The statement will likely scrap talk of a compromise that would keep tax rates static, but boost tax revenues by eliminating tax loopholes used by wealthy Americans.
During a rare White House press conference Wednesday, Obama seemed to leave room for that compromise by hedging when he was asked if he would insist on a return to Clinton-era tax rates.
“If the Republican counterparts or some Democrats have a great idea for us to raise revenue, maintain progressivity, make sure the middle class isn’t getting hit, reduces our deficit, encourages growth, I’m not going to just slam the door in their face,” Obama said.
The partisan standoff was also sharpened by Tuesday’s declaration that Obama wants to get an extra $1.6 trillion in tax revenues over the next 10 years.
Obama and both Democratic and Republican legislators are slated to formally begin negotiations Nov. 16 to avoid the so-called “fiscal cliff.”
GOP leaders, including House Speaker Rep. John Boehner, are loath to raise taxes because of the damage they could do to the nation’s nascent economic recovery.
They also oppose increasing tax burdens on the wealthy, partly because the extra taxes could further stall job growth, but also because wealthy entrepreneurs are important donors to the party.
Since the election, however, some Republicans have urged a more populist party strategy that would distance Republicans from wealthier Americans. That emerging wing of the party is less hostile to tax increases on the wealthy.
Obama’s sought-for tax increase of $1.6 trillion, however, would only trim the federal government’s planned borrowing.
Under Obama’s spending plan, the federal government would borrow another $5 trillion by 2016, and another $4 trillion between 20176 and 2022.
The federal government currently owes lenders roughly $11.5 trillion.
