Campaign-trail Obama asks public support for ‘tax cuts’

Neil Munro White House Correspondent
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Campaign-trail President Barack Obama took his his genial tax-cutting message to Pennsylvania today, 24 hours after Obama had dumped his hardball, tax-boosting big-government wish-list on Republicans’ toes.

“If Congress does nothing, every family in America will see their taxes automatically go up on Jan. 1,” he told a picked audience at a toy factory in Pennsylvania. “That’s sort of like the lump of coal you get for Christmas.”

“The key is, though, that the American people have to be involved. … That’s why I’m asking you to make your voices heard in the next couple of weeks,” he said, in what may prove to be the first campaign speech of the 2014 mid-term elections.

The speech came the day after Treasury Secretary Timothy Geithner delivered Obama’s tax-and-spend demands to the GOP.

They include a tax hike worth $1.6 trillion over 10 years, an immediate stimulus of at least $50 billion, and a surrender by Congress of its control over the federal government’s debt limit.

In exchange, Obama offered to consider — but not necessarily accept — GOP requests in 2013 to cut $400 billion from Medicare and other programs that are strongly favored by off-year voters.

According to Obama’s offer, that GOP budget-cutting measure would be debated a year before the 2014 election, but without any guarantee that Democrats would share the political pain of curbing spending.

Obama’s proposal did not sketch out any cuts to federal spending, despite the increasing worries about the growing debt bubble.

Republicans leaders say they will compromise by removing tax loopholes used by wealthy taxpayers, but want to preserve existing tax rates. They also want changes — such as marketplace incentives or enrollment delays — to modestly slow spending on fast-growing entitlement programs.

GOP leaders were surprised by Obama’s one-sided offer, and said it set back efforts to find a compromise fix for the so-called “fiscal cliff,” which is the synchronized arrival Jan. 1 of several tax increases and budget cuts.

Many of the fiscal cliff changes are supported by members of both parties, but they may shock the economy into another recession.

That recession would hinder Obama’s second-term ambitions, but might also provide an opportunity for Democrats to regain a House majority in November 2014.

Back in Pennsylvania, Obama did not mention his proposed $1.6 trillion tax hike or $50 billion stimulus, nor his government’s $11.5 trillion debt.

Instead, he told his audience that each family stood to gain $2,000 for gas, groceries and college debts if Republicans accept his proposal to extend George W. Bush’s tax cuts for everyone, while boosting a plethora of direct and indirect taxes on people earning more than $250,000.

Republicans need to pass the “fair and balanced responsible plan that I talked about in the campaign,” he said.

“It’s not acceptable for me, and I don’t think its acceptable to you for just a handful of Republicans in Congress to hold tax-cuts for middle-class folks hostage simply because they don’t want taxes rates raised,” he said.

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