Obama to push extension of middle-class tax cuts

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The Wall Street Journal
By: Laura Meckler
July 9, 2012

Obama to push extension of middle-class tax cuts

WASHINGTON--President Barack Obama will propose a one-year extension of the Bush-era tax cuts for families earning less than $250,000 today, an effort to shift the conversation away from the sagging economy and onto ground of tax fairness, which Mr. Obama prefers.

His campaign will amplify the message with a series of battleground state events this week.

On Monday, Mr. Obama will appear in the East Room, surrounded by people who would benefit from the extension, an administration official said. It's another display of the power of incumbency, whereby a president can command attention for his ideas in grand surroundings not available to his challenger.

Mr. Obama will make the same case on a campaign trip Tuesday to Iowa.

Mr. Obama has long supported a permanent extension of Bush-era tax cuts for families earning less than $250,000, and has called for those aiding wealthier families to expire. But Monday's event marks the first time Mr. Obama will specifically call for a one-year extension for the lower earning group, a nod toward the desire to do something in the short run to create more certainty in an uncertain economic climate.

Robert Gibbs, an adviser to the Obama campaign, predicted the one-year extension will have "a decent impact on the economy."

"We need to give middle class families the certainty that they need and deserve that the tax rates that they're paying this year aren't going to change next year," he said on MSNBC's "Morning Joe."

Still, The proposal is unlikely to move forward in Congress, as lawmakers await the results of the November election.

Republican challenger Mitt Romney would extend the lower tax rates for families of all incomes, saying it would be damaging to the economy. House Republicans plan a vote this month on extending all the lower rates as well.

A spokeswoman for Mr. Romney had no immediate comment on Mr. Obama's event.

In December 2010, Mr. Obama agreed to extend the tax cuts temporarily for all taxpayers, citing the stalled economy and the need to get a bipartisan agreement. He has said he will not extend the lower tax rates for upper-income families again.

The lower rates expire for all Americans at the end of the year, and many economists worry that failure to agree on some form of extension--combined with deep spending cuts scheduled to hit at the same time--would be a blow to the economy.

That case was bolstered on Friday, when another disappointing jobs report showed the national unemployment rate remaining at 8.2%.

Many economists have called for a temporary extension of all the lower rates, given the economy, and Democrats including Sen. Charles Schumer of New York and House Minority Leader Nancy Pelosi of California have said they should be extended for families earning up to $1 million a year.

Mr. Obama will amplify his message in interviews today with local TV news anchors from six battleground states--New Hampshire, Florida, North Carolina, Iowa, Wisconsin and Nevada. Anchors from Louisiana and Kentucky will also take part in the "Live from the White House" event.

Tax fairness is a centerpiece of Mr. Obama's reelection campaign and its argument that Mr. Obama will do the most to protect the middle class. He argues that the country cannot afford tax cuts for the rich.

The Obama message will be echoed by his reelection campaign, which plans events all week in battleground states, including a news conference with middle class families in Concord, N.H., and statements by local elected officials on the issues in Las Vegas, Colorado, and Tampa Bay, Fla.

The campaign also has ramped up its call for Mr. Romney to release more years of his tax returns and to answer questions about offshore bank accounts. That, too, is an effort to cast Mr. Romney, who has a large personal fortune, as out of touch with the middle class.

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