WASHINGTON – As negotiators closed in on a tax-and-spending deal to avert the “fiscal cliff,” President Obama delivered a nationally televised plea Monday for a final push by Congress in the hours remaining before midnight Monday when taxes are set to increase.
“They’re close, but they’re not there yet,” Obama said, referring to bipartisan talks led by Vice President Joe Biden and Senate Republican leader Mitch McConnell of Kentucky.
The president added, “if there’s one second left” before Congress has to act, “they will use that last second.” Among the issues left to be resolved, he said, confirming earlier news reports, is an agreement that would delay across-the-board spending cuts, which would otherwise go into effect on Wednesday.
“So keep the pressure on over the next 12 hours or so,” he said to an invited audience that reacted with applause and laughter to his brief remarks, including when he said that he would be spending New Year’s Eve in Washington as lawmakers try to finalize a deal that can win approval in both houses.
Obama appeared to anticipate criticism, already building from liberals, that he is giving too much away. He won re-election last month on a plan to raise taxes on annual income above $250,000 for couples. But the deal would raise that threshold to $450,000 a year, and generate considerably less than half of the $1.6 trillion in additional revenue over 10 years that Obama had initially sought.
The president emphasized that the potential agreement, though “modest,” would achieve his “top priority:” preventing an income tax hike on 98% of U.S. taxpayers.
He also pointed out that the deal would extend tax credits for families with children, tuition tax credits for college students, tax credits for clean energy and extended unemployment benefits for 2 million jobless Americans.
Obama said he would have preferred a much larger agreement on government revenues and long-term spending. “But with this Congress, that was obviously a little too much to hope for,” he said, to laughter from the audience.
And while he insisted that Congress needed to stay focused on the needs of the American people – “not politics” – he drew applause when he boasted that the potential deal, if approved, would result in something that Republicans had said they “would never agree” to: a permanent tax-rate increase on the wealthiest Americans.
He also began staking out political turf for the next phase of the tax-and-spending fight, which will play out over much of 2013, if not longer. Any agreement to deal with spending cuts would have to be balanced, with increased revenues as one part of the equation.
If Republicans think that can “shove only spending cuts” as a way of shrinking the deficit in future years, “they have another think coming. That’s not how it’s going to work,” Obama said.
However, some liberals, including former Obama administration economic advisor Jared Bernstein, are warning that Republicans will never agree to higher taxes beyond those contained in whatever year-end deal is finally struck.
The highly choreographed event at the White House office complex included what Obama aides described as middle-class taxpayers. Obama shook hands with many of the 14 men and women who stood onstage behind him, then ushered them into another room for a photo session.
Obama ended what may have been his final public event of 2012 by wishing everyone a happy new year.