Obama Back In Campaign Mode; This Time, It's Taxes

NPR icon by Scott Horsley
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President Obama is hoping the same campaign tools that helped him win re-election will also deliver a policy win in the fight over federal taxes.

The president wants Congress to extend Bush-era tax cuts for most Americans, while allowing taxes to go up for the wealthiest 2 percent. His aides are using email, social media and beyond-the-Beltway campaign appearances in hopes of putting pressure on Republican lawmakers.

Inside the U.S. Capitol, old battle lines barely seem to have budged. Republicans resist higher taxes, while Democrats resist cuts to entitlement programs. GOP House Speaker John Boehner emerged from his office Friday to tell reporters budget talks with the White House were going nowhere.

"There's a stalemate. Let's not kid ourselves," Boehner said.

He sounded shocked by what Treasury Secretary Timothy Geithner had spelled out the day before as the president's opening bid: an extra $1.6 trillion in tax revenue over the next decade. Obama also insists that much of the money come from higher-income tax rates on the rich, which Boehner says is the wrong way to go.

This "was not a serious proposal," the Ohio lawmaker said.

Hitting The Trail Again

With talks in Washington apparently coming apart, the president made a quick getaway Friday to a place where people still know how to put things together.

The president visited the K'Nex toy factory outside Philadelphia, where workers produce a kind of updated TinkerToys, with bright plastic pieces that can be molded into roller coasters, steam shovels or even a U.S. flag. The president described the workers as "Santa's extra elves."

This kind of factory visit was a staple of the president's re-election campaign. So too, the president noted, was his call for higher taxes on the wealthy.

"It wasn't like this should come as a surprise to anybody," Obama said. "We had debates about it ... and at the end of the day, a clear majority of Americans, Democrats, Republicans, Independents — they agreed with a balanced approach."

Coming Down To The Wire

Congressional Republicans acknowledged after the election that tax revenues have to go up, but they have yet to see eye-to-eye with the president about how much extra tax money should be raised or where it should come from.

Adding urgency to this debate is a New Year's deadline: Unless the two sides cut a deal by then, taxes for everyone will go up automatically. The administration estimates it would cost a typical middle class family about an additional $2,200 next year.

K'Nex CEO Michael Araten says he'd rather see his own tax rate go up by a few percentage points than drag the whole economy down. Araten, a Democrat, expects that lawmakers and the president eventually will make a deal, but probably not before it comes down to the wire.

"At the end of the day, they're going to get it done," Araten says. "I think they recognize it's too important for the American economy, and the American people are watching. And when the American people watch, usually our leaders pay attention."

Obama wants to make sure people do more than just watch. He's activated his campaign email list, and is urging people to use Facebook, Twitter or plain old phone calls to contact their lawmakers and demand an extension of tax cuts for the middle class, and to remind Congress "not to get bogged down in a bunch of partisan bickering."

The president knows he'll have a better chance of winning higher tax rates for the wealthy if he can first disconnect those rates from the ones that middle class families pay. Republican lawmakers know that as well, which is why they're fighting hard to keep the two tied together.

Copyright 2012 National Public Radio. To see more, visit http://www.npr.org/.

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