President Obama today did not rule out negotiating with Republicans over the extension of tax cuts for the rich. But he insisted any such deal could only be struck after tax cuts for the middle class are dealt with separately.
The president's remarks came at a news conference where he also appealed for tolerance of the views of American Muslims and contended that Democrats can run on his economic policies despite widespread frustration. He also chided Republicans for "playing politics" with his appointments and his economic proposals.
His opening remarks denounced "tax cuts for millionaires" and the GOP push to extend the soon-to-expire 2001 and 2003 tax cuts for all taxpayers, not just for those who make less than $250,000, as recommended by the White House.
But later, when asked about his willingness to cut a deal with congressional Republicans, Obama said there is "room for discussion" with Republicans about the high-end tax cuts. However, that would depend on tax-cut deal for the middle class, he suggested.
"Middle-class families need tax relief right now, and I'm prepared to work on a bill and sign a bill this month that would ensure that middle-class families get tax relief," he said, stating that would help 97 percent of Americans. "Now, that seems like a common-sense thing to do. And what I've got is the Republicans holding middle-class tax relief hostage because they're insisting we've got to give tax relief to millionaires and billionaires."
With polls suggesting big trouble for his party, Obama indicated he hopes to persuade voters that this tax debate is "what this election is all about" rather than about the poor jobs picture.
"My position is, let's get done what we all agree on," he said. "What they've said is they agree that the middle-class tax cuts should be made permanent. Let's work on that. Let's do it. We can have a further conversation about how they want to spend an additional $700 billion to give an average of $100,000 to millionaires."
He also criticized congressional Republicans for blocking his appointments and blocking a bill he backs to assist small businesses.
"One thing we can do next week is end a month-long standoff on a small-business jobs bill that's been held up in the Senate by a partisan minority," he said, quoting Republican Sen. George Voinovich of Ohio approvingly for saying games are being played on the measure. "I could not agree more," said Obama.
He raised the issue of appointments when asked whether fear of the Senate confirmation process could block him from appointing Harvard professor Elizabeth Warren as head of the newly created consumer financial protection bureau.
"The idea for this agency was Elizabeth Warren's," said Obama. He said that he will have an announcement "soon" but would not commit to her getting the powerful post.
Asked whether he is concerned about her confirmation, he said, "I'm concerned about all Senate confirmations these days," adding, "It's very hard when you've got a determined minority in the Senate that insists on a 60-vote filibuster on every single person that we're trying to confirm."
The president also used the press conference to officially announce that he is naming Austan Goolsbee to replace Christina Romer as chair of the Council of Economic Advisers. He called Goolsbee "one of the finest economists in the country" and "someone who has a deep appreciation of how the economy affects everyday people, and he talks about it in a way that's easily understood."
The appointment was immediately attacked by House Minority Leader Boehner, who said it "represents a commitment to more of the same failed 'stimulus' policies." He said Obama "needs people around him who've created jobs in the private sector and understand the challenges small businesses face, people who aren't wed to the worn-out notion that our nation can simply spend its way back to prosperity."
The president was also pushed on his insistence that healthcare reform would reduce costs, saying that an accelerated but marginal increase in costs is an acceptable price to pay for covering tens of millions more Americans. Six months after the health reform bill became law, Obama said that efforts to drive down costs have proven tough to achieve.
Earlier this week, federal actuaries projected that the rate of growth in spending on health will increase to 6.3 percent in 2019 versus 6.1 percent if the bill had not been signed into law. The expected increase fueled Republican critics who said that the report, issued by the Centers for Medicare and Medicaid Services, runs counter to claims made by the Obama administration when it tried to secure support for the legislation.
"What they're saying, as a consequence of us getting 30 million additional people health care, at the margins that's going to increase our cost, we'll do that," Obama said. "We didn't think that we were going to cover 30 million people for free."
Obama acknowledged that some congressional Democrats are running away from healthcare reform.
"We're in a political season where every candidate out there has their own district, their own makeup, their own plan, their own message," he said.
This article appears in the September 11, 2010, edition of National Journal Daily PM Update.