Obama willing to go over fiscal cliff, according to White House leaks

Neil Munro White House Correspondent
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White House sources are telling Democratic reporters that the president is willing to go over the so-called “fiscal cliff” if GOP leaders don’t agree to his demand for higher tax rates on the wealthy without substantive spending cuts.

A political deadlock would mean an automatic tax increase for middle-class and wealthy Americans on January 1, and the opportunity for Obama and the Democrats to push a tax-cutting bill for middle-class voters in 2013, say the White House officials, who leaked the claim to two liberal columnists.

Republican lawmakers, including House Speaker John Boehner, say they are opposed to any increase in tax rates, but have said they would vote to increase tax revenues by ending tax breaks used by wealthier Americans.

The first of two December 3 leaks came via the left-wing Mother Jones publication, where columnist David Corn reported that “according to senior administration officials, Obama is not eager to go over the cliff, but he is willing. If no deal is reached by the end of the month, all the Bush tax cuts — for the rich and not-rich — will evaporate.”

“Obama would then demand in early January that the new Congress immediately pass legislation to reinstate the lower tax rates for the bottom 98 percent,” wrote Corn.

Corn’s claim was later seconded by a left-wing columnist at The Washington Post, Greg Sargent, who sometimes is used by the White House to leak official views.

“I have just confirmed that [Corn’s report] is accurate — Obama is willing, albeit very reluctant, to go over the cliff,” Sargent wrote.

This stance puts Republicans at a disadvantage because the “fiscal cliff” will automatically raise upper-income taxes, ensuring “Dems can come back and move to pass just the middle class tax cuts, challenging Republicans to vote against renewing them after they have expired,” Sargent wrote.

But a deadlock and a trip over the “fiscal cliff” would also allow the GOP to stand firm on their opposition to any increases in tax rates, and effectively require the Democrats to cooperate with a GOP proposal to revamp the nation’s tax laws in 2013.

That national tax debate could help the Republicans win the 2014 mid-term elections, when Obama and Democrats will try to regain the House majority lost in 2010.

Democrats and White House officials are already trying to blame the GOP for any deadlock and the scheduled tax increases, and are now arguing that the nation’s stalled economy was caused by the GOP’s determination to protect the income of wealthy Americans.

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Neil Munro