With taxes set to rise at the end of the year, President Barack Obama said on Saturday that raising taxes on the wealthiest Americans is something he will not compromise on.
“I’m willing to make more entitlement spending cuts on top of the $1 trillion dollars in cuts I signed into law last year,” Obama said in his weekly address. “But if we’re serious about reducing our deficit while still investing in things like education and research that are important to growing our economy -- and if we’re serious about protecting middle-class families -- then we’re also going to have to ask the wealthiest Americans to pay higher tax rates. That’s one principle I won’t compromise on.”
Obama called for a tax hike on the wealthiest Americans throughout his re-election campaign. Members of his administration have been locked in stalled negotiations for weeks now regarding the so-called fiscal cliff -- the term given to the automatic tax hikes and spending cuts that will go into effect if no budget deal is reached by the end of the year -- as House Republicans refuse to budge on the tax increases.
Instead, Republicans have proposed closing loopholes and entitlement reforms as a solution to the budget impasse.
“So far, [Republicans have] put forward an unbalanced plan that actually lowers rates for the wealthiest Americans,” Obama said. “If we want to protect the middle class, then the math just doesn’t work.”
If bipartisanship cannot work and the members of Congress fail to find a solution to avert January’s automatic spending cuts and tax hike, middle-class families will be hit with an tax increase of about $2,200 a year.
Democrats have presented Republicans with the option of passing a bill that would extend tax cuts for the middle class and, in essence, provide a sense of stability to businesses, most of which depend on the purchasing power of the U.S. middle class. Both parties and economic experts have agreed that a fall over the fiscal cliff could result in a recession and a higher unemployment rate in 2013.
Still the president said more should be done than just extend middle-class tax cuts.
“I stand ready to work with Republicans on a plan that spurs economic growth, creates jobs and reduces our deficit -- a plan that gives both sides some of what they want,” he said. “I’m willing to find ways to bring down the cost of health care without hurting seniors and other Americans who depend on it.”
In response to Obama, Florida Sen. Marco Rubio delivered the Republicans’ weekly address, in which he admitted that America’s debt must be brought under control. However, he said, “tax increases will not solve our $16 trillion debt. Only economic growth and a reform of entitlement programs will help control the debt.”
Rubio also called for removing “unjustified loopholes” and sharing the goal of getting new revenue “by creating new taxpayers, not new taxes.”
“And we must get the cost of health insurance under control,” he said. “You should be able to get a health care plan that fits your needs and your budget, from any company in America that’s willing to sell it to you, and with the same tax benefit if you buy it yourself or have an employer buy it for you. These ideas will help create middle class jobs.”
Laura is a U.S. politics reporter for the International Business Times. She was always fascinated by the BBC World News each morning on the radio in Jamaica. That, and a love...