President Obama fired his opening salvo in negotiations over the looming fiscal cliff, saying his reelection validated Democratic plans to to raise taxes on the wealthy to help reduce the federal budget deficit.
“A majority of Americans agree with my approach,” he said at the White House, citing his decisive victory over Republican Mitt Romney on Tuesday. “We can’t just cut our way to prosperity. The wealthiest Americans have to pay a little more in taxes.”
Obama added that he was “open to compromise” and “open to new ideas” but said he would block any approach that didn’t include higher taxes as well as spending cuts.
Republican leaders in Congress are ruling out any increase in tax rates as part of a deficit-reduction deal.
The stakes couldn’t be higher in this game of chicken between the White House and Congress. Without an agreement by the end of the year, the payroll-tax holiday, Bush-era tax cuts and various other tax credits would expire, costing the average American household $3,500 annually, according to analysts.
Obama laid down his marker from the East Room of the White House in front of nearly 200 supporters. He took no questions from the White House press corps, who were kept in the back of the room during the highly orchestrated remarks.
House Speaker John Boehner, R-Ohio, said earlier Friday that he is open to revenue increases, such as closing tax loopholes, but remains adamantly opposed to raising tax rates for anybody.
Obama’s argument was virtually identical to the one he made in the summer of 2011, when leaders failed to reach a compromise that would raise the nation’s borrowing limit. The president is banking that his comfortable victory in Tuesday's election will give him additional leverage this time around.
The president invited congressional leaders to the White House next week to kick start negotiations.
Joined by Vice President Joe Biden, Obama reminded lawmakers that election season had passed, leaving precious little time to coalesce around a solution.
“It’s time to get back to work,” he said. “And there’s plenty of work to do.”