White House Won't Rule Out Taxing Middle-Class Workers' Health Benefits

By Michael D. Shear
Washington Post Staff Writer
Monday, June 29, 2009

President Obama's top political adviser declined yesterday to rule out the possibility that the White House would agree to a tax hike on health insurance plans that would hit middle-income Americans.

Speaking on ABC's "This Week," David Axelrod declined to repeat Obama's "firm pledge" during the campaign that families making under $250,000 would not see "any form of tax increase, not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes."

Instead, Axelrod said the president has no interest in "drawing lines in the sand" on the issue of how to pay for the costly health reform plan making its way through Congress.

"One of the problems we've had in this town is that people draw lines in the sand and they stop talking to each other. And you don't get anything done," Axelrod said. "That's not the way the president approaches this."

Axelrod insisted that Obama is "very cognizant of protecting people -- middle-class people, hardworking people, who are trying to get along in a very difficult economy." And he promised that the president "will continue to represent them" in negotiations with Congress over health reform.

He also repeated Obama's preference for a cap on the deductions that people making over $250,000 can take on their taxes as a way to pay for health-care changes.

But under repeated questioning from host George Stephanopoulos, Axelrod said the White House is open to "a lot of different formulations" for paying for health-care reform.

He also waded into the ongoing questions about the Iranian elections, dismissing the harsh words about U.S. meddling from President Mahmoud Ahmadinejad as "bloviations that are politically motivated."

Axelrod also appeared on NBC's "Meet the Press," where he ducked questions about Republican South Carolina Gov. Mark Sanford's unusual behavior after he acknowledged an extramarital affair. And Axelrod defended the administration's decision to coordinate with a reporter in advance of a news conference to ask a question posed by an Iranian.

"I'm very comfortable with what we did," he said.

On CNN, Gen. Ray Odierno, the commander of U.S. forces in Iraq, said he thinks the Iraqi military forces are ready to take over from American soldiers in the country's biggest cities.

The handover takes place tomorrow even as there have been several large attacks in the country that have killed scores of Iraqis.

"I do believe they're ready," Odierno told John King, host of "State of the Union." "They've been working towards this for a long time. And security remains good. We've seen constant improvement in the security force, we've seen constant improvement in governance. And I believe this is the time for us to move out of the cities and for them to take ultimate responsibility."

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