Obama official: Tax cuts on wealthy must expire

Taking a hard-line after seizing an election victory, the White House on Wednesday argued that the election results validated President Obama’s view that the tax cuts benefiting wealthy Americans must expire.

An Obama administration official said that the president, as he signaled in his victory speech Tuesday night, wants to work with Republicans on the issue. But the White House feels strongly that Obama ran on a platform to raise taxes on the wealthy and now has a mandate to do so, the official said. The official requested anonymity because the White House has not made a formal statement on this issue.

Exit polling on Tuesday night showed clear evidence that most voters agree with Obama’s approach. Forty-eight percent of voters said taxes should be increased only on Americans earning at least $250,000 per year, which is the president’s view.

An administration official also noted that executives at top American companies, such as Honeywell chief executive David Cote, has endorsed a plan that would raise tax revenues for upper-income Americans. Other business groups, such as the right-leaning Chamber of Commerce, oppose increases in tax revenue.

Obama is proposing about $1.5 trillion in new tax revenue over a decade, largely by raising rates to 39.6 percent for wealthy Americans and eliminating tax deductions and loopholes. That is part of a broader plan to tame the debt, which includes cuts in domestic and defense spending and modest changes to entitlements.

Speaking this week on MSNBC’s “Morning Joe,” Obama made clear how he would interpret a win.

“If I’ve won, then I believe that’s a mandate for doing it in a balanced way,” he said. “We can do some more cuts. We can look at how we deal with the health care costs in particular under Medicare and Medicaid in a serious way. But we are also going to need some revenue.”

Congressional leaders, including Senate Majority Leader Harry Reid (D-Nev.) and House Speaker John Boehner (R-Ohio), were also drawing their lines in the sand Wednesday.

Overnight and this morning in Chicago, the president telephoned Boehner, Reid, Senate Republican Leader Mitch McConnell and House Democratic Leader Nancy Pelosi to talk about the legislative agenda for the remainder of the year. The president reiterated his commitment to finding bipartisan solutions to: reduce the deficit in a balanced way, cut taxes for middle class families and small businesses and create jobs. Obama said he believed that the American people sent a message in yesterday’s election that leaders in both parties need to put aside their partisan interests and work with common purpose to put the interests of the American people and the American economy first.

Related stories:

The election is over. The fiscal cliff begins.

Obama ready to play hardball with Republicans

Zachary A. Goldfarb is policy editor at The Washington Post.
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