President Obama pressed Congress to extend current tax rates for Americans making under $250,000 a year, decoupling them from a package Republicans are pushing to extend all of the Bush-era tax rates set to expire at the end of the year.
Making a case that has been a regular feature of his recent stump speeches, Obama said in his weekly address that citizens with an income over the $250,000 threshold could afford to "go back to the income tax rates they were paying under Bill Clinton.”
"The last thing we need right now is more top-down economics," Obama said. "Under my plan, 98 percent of American families won’t see their income taxes go up at all. But the other 2 percent of Americans will have to pay a little more in taxes on anything they make over $250,000."
Obama touted the economic record of former President Clinton, saying that the Clinton-era tax rates accompanied an economic boom for the nation.
"If you remember, that was when our economy created nearly 23 million new jobs, the biggest budget surplus in history, and millionaires were doing pretty well," Obama said.
The president said Congress should pass an extension of the tax cut for earners making less than $250,000, even if there was lingering disagreement among lawmakers on the appropriate tax rates for other brackets.
"Even if we disagree on the tax cuts for the wealthiest Americans, we all agree that no American should pay more taxes on the first $250,000 of their income," Obama said. "So let’s at least agree to do what we all agree on. That’s what compromise is all about.
"Let’s not hold the vast majority of Americans and our entire economy hostage while we debate the merits of another tax cut for the wealthy," Obama continued. "Let’s skip the unnecessary drama, the needless delays and all the partisan posturing and let’s just do the right thing for the people who sent us here to serve."
But Republicans are unlikely to heed Obama’s calls to allow an extension for those under the $250,000 threshold, while allowing taxes to rise on others.
The GOP House is expected to vote on a one-year extension of all the Bush-era rates before the August recess. Republican leaders in both the House and Senate have also considered including provisions that could force Congress to take up comprehensive tax reform in 2013.
Republicans say allowing any of the Bush-era rates to expire would provide an unnecessary hit on a still weak economy, further hampering job growth.
On Monday, Obama launched his effort to push for the partial tax cut extension, with an East Room event, where he was joined by taxpayers he said would face a $2,000 tax increase if lawmakers failed to act.
