President Obama described his negotiating position on the soon-to-expire Bush tax cuts during a visit to a Chrysler transmission plant in Indiana.
The Kokomo auto parts plant stayed open largely as a result of the federal government’s bailout of Chrysler and fellow auto maker GM after Obama took office last year.
“Now, we all know that one plant by itself doesn’t mean that there aren't people in Kokomo who are still hurting,” said Obama in a speech Tuesday with Vice President Joe Biden. “And I know that before this plant started rehiring, a lot of you were in the same position, so you remember that it is a tough, tough thing when you’re out of work, especially when you’ve taken a lifetime of pride in working and supporting a family and making great products.”
Obama talked about the economy and he reiterated his plans for extending middle-class tax cuts. He is scheduled to meet next Tuesday with congressional leaders of both parties to try to arrive at a compromise on whether and for how long to extend the tax cuts for taxpayers making over $250,000 a year.
“Next year, taxes are set to go up for middle-class families unless Congress acts,” he said. “If we don’t act by the end of the year, a typical middle-class family will wake up on January 1st to a tax increase of $3,000 per year. So, in the next few weeks, I’m asking Congress to take up this issue. The last thing we can afford to do right now is raise taxes on middle-class families. If we allow these taxes to go up, the result would be that a lot of people most likely would spend less, and that means that the economy would grow less. So we ought to resolve this issue in the next couple of weeks so you’ve got the assurance that your taxes won’t go up when that clock strikes midnight.”
Obama insisted that the middle-class tax cuts are an area where Democrats and Republicans agree. “The only place where we disagree is whether we can afford to also borrow $700 billion to pay for an extra tax cut for the wealthiest Americans, for millionaires and billionaires,” he said. “I don’t think we can afford it right now—not when we are going to have to make some tough decisions to rein in our deficits. That's going to require sacrifice from all Americans, including those who can most afford it. So I’m eager to sit down with leaders from both parties next week and to hammer this out. But we need to hammer it out.”
