White House to GOP: Raise tax rates on the rich, or no deal

December 5, 2012

White House officials signaled in their strongest terms to date Wednesday that President Obama won’t negotiate a fiscal cliff solution until congressional Republicans agree to raise the tax rate on the country’s wealthiest 2 percent.

At his afternoon briefing, White House Press Secretary Jay Carney stopped short of saying that Obama and his negotiators wouldn't speak to Republicans until they agree to the higher tax rates. But he made clear that is the starting point for further negotiations.

“The fact of the matter is, the president has an absolute principle that he’s not going to abandon, which is that rates are going up on top earners,” Carney said. He declined to say whether there had been talks Tuesday or Wednesday between the White House and Republicans.

Carney said the president's team “is very engaged in this process. But here’s what we’re not going to do: We’re not going to negotiate against ourselves. We’re not going to take the flat refusal of Republicans to acknowledge what will happen, which is that rates will go up on top earners, as an incentive to negotiate against ourselves.”

Carney also warned Republicans not to engage in any "gamesmanship" related to the debt ceiling. And he confirmed that the Office of Management and Budget has asked federal agencies to provide "information" to prepare for the automatic spending cuts that would go
into effect if a deal is not reached. But, he said, "This action should not be read as a change in commitment" to reach a deal.

Carney and Jason Furman, a deputy director of the National Economic Council and adviser to the president on economic issues, fielded nearly an hour’s worth of questions from reporters, nearly all of them about the "fiscal cliff," the series of tax hikes and spending cuts that will take effect in January if a broader budget deal isn't struck between the White House and Congress.

Furman took a series of tough questions on Obama’s opposition to a House Republican proposal to limit the income-tax deduction for charitable donations – an idea the president himself supported three years ago. At the time, Obama said limits would not stifle charitable giving, but now he is making that case that the Republican proposal
would hurt donations.

Furman said the Republican proposal would effectively eliminate the deduction for high-income earners, unlike the president’s proposal to limit it in a less dramatic way.

 

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Natalie Jennings · December 5, 2012