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Obama pushes middle-class tax cut extension

President Obama tax cuts

REUTERS

President Obama spoke about extending tax cuts in the East Room of the White House Monday.

WASHINGTON (AP) — President Barack Obama, eager to shift election-year attention away from the nation’s lackluster jobs market, called on Congress Monday to extend tax cuts for only low and middle income earners while allowing taxes to increase for families that make more than $250,000 a year.

‘‘Let’s not hold the vast majority of Americans and our economy hostage while we debate the merits of another tax cut for the wealthy,’’ said Obama, flanked by a dozen people the White House said would benefit from the middle class-oriented tax cut extension.

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Obama called for a one-year extension of the Bush-era tax cuts for households making less than $250,000. He said the outcome of his November election contest with Republican rival Mitt Romney would then determine the fate of the tax cuts for higher income earners.

‘‘My opponent will fight to keep them in place. I will fight to end them,’’ he said.

The full George W. Bush era tax cuts are due to expire at the end of the year unless Congress acts.

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Obama has long supported expiration of the tax cuts for those making more than $250,000. But the White House and the president’s re-election team are reviving his arguments now as a way to paint congressional Republicans as obstructionists and Romney as a protector of the wealthy, suggesting the GOP push for an across-the-board extension of the tax cuts puts the middle class at risk.

The contours of the tax debate are largely the same as they were when the cuts were due to expire at the end of 2010. While Obama opposed an extension for higher income earners then as well, he ultimately agreed to full two-year extension, in part to win concessions for other legislation.

The president’s shift to the tax debate follows Friday’s lackluster jobs report showing the nation’s unemployment rate stuck at 8.2 percent. And it comes as Democrats embark on a coordinated attack on Romney, intensifying calls for him to explain offshore bank accounts and release several years of tax returns.

The strategy is aimed at portraying Romney, whose personal wealth could exceed $250 million, as disconnected from middle-class voters.

‘‘We have to continue to grow our economy. We have to grow it from the middle class out,’’ Robert Gibbs, an Obama campaign adviser, said Monday in an interview on NBC’s ‘‘Today’’ show. ‘‘But for millionaires and billionaires, they don’t need a tax cut,’’ he added.

Gibbs said, ‘‘We’re going to have to make some tough choices in this country. We can’t continue to spend the kind of money that was spent in the last decade.’’

Romney spokeswoman Andrea Saul said Obama’s proposal amounted to a ‘‘massive tax increase’’

‘‘It just proves again that the president doesn’t have a clue how to get America working again and help the middle class,’’ Saul said.

Romney aides have also called Democratic attacks on the presumptive GOP nominee’s wealth an ‘‘unfounded character assault.’’

Romney hasn’t shirked from his wealth in the face of renewed Democratic criticism. He held a $50,000 per person fundraisers Sunday in the Hamptons, New York’s exclusive string of waterfront communities on Long Island’s South Shore.

Romney aides also announced that the campaign and the Republican National Committee raised a combined $106 million in June, the former Massachusetts governor’s biggest monthly haul so far. The Obama campaign and the Democratic National Committee raised $71 million last month.

The president’s pitch may face opposition not only from Republicans, but also some congressional Democrats. House Minority Leader Nancy Pelosi, D-Calif., and Sen. Charles Schumer, D-N.Y., a member of his party’s Senate leadership, have both advocated denying the tax cut extension to those making above $1 million annually.

Extending the tax cuts only for households making below $250,000 costs the government about $800 billion less over 10 years than extending them for everyone. The full cuts cost the government about $4.5 trillion over a decade.

Obama was to continue the tax debate Tuesday during a campaign trip to Iowa. His re-election team was also promoting the president’s tax policy at a series of events this week in battleground states, including New Hampshire, Colorado and Nevada.

The Bush-era tax cuts are due to expire at the end of the year unless Congress votes to extend them. Economists worry that across-the-board tax increases, along with automatic spending cuts also scheduled to take hold at year’s end, could be a blow to the shaky US economy.

Associated Press writer Alan Fram contributed to this report.
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