July 10th, 2012
04:15 PM ET
9 years ago

Obama calls for support on tax proposal

(CNN) - President Barack Obama took his tax proposal on the road Tuesday, drawing up support for his call to extend the Bush-era tax cuts for households bringing in less than $250,000 per year.

In his remarks at a community college in Cedar Rapids, Iowa, Obama tried to beat back critics who point to the resulting tax hike on those falling above the quarter-million dollar threshold.

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"This has nothing to do with me wanting to punish success," Obama said at the campaign event. "For us to give a trillion dollars worth of tax breaks to folks who don't need it and aren't even asking for it, that doesn't make sense."

Obama signed a bill in 2010 to extend all of the Bush-era tax cuts until the end of 2012, citing the need for economic stimulus at the time. He has since vowed he would not permit another extension of the lower tax rates for wealthy Americans and re-emphasized that promise in a White House announcement on Monday.

His proposal would maintain the current lower tax rates for families making up to $250,000 for another year while allowing tax rates to return to 1990s levels for those earning more. The White House says 98% of Americans would benefit from the extension.

But the wealthy would still benefit if the Bush tax cuts are preserved for everyone else, since some of their income is also taxed at the lower rates of 10%, 15%, 25% and 28%.

Republicans have sharply opposed the president's policy, saying it could severely affect small business owners.

Mitt Romney's campaign, for example, criticized Obama's announcement as more bad policy from the president in the wake of the latest disappointing jobs report showing a stagnant unemployment rate of 8.2%.

"President Obama's response to even more bad economic news is a massive tax increase," said Andrea Saul, the Romney campaign's spokeswoman. "It just proves again that the president doesn't have a clue how to get America working again and help the middle class."

Unlike Obama, Saul continued, Romney "understands that the last thing we need to do in this economy is raise taxes on anyone."

Republicans also complained that Obama's plan would raise taxes on more than 900,000 small-business owners who report their income in individual returns as so-called flow-through enterprises.

On Tuesday, however, Obama called on Congress to avert a stalemate in the tax debate, making the case that both parties agree to keep the cuts for 98% of Americans.

"We disagree on the two percent," he said. "Let's not hold the vast majority of Americans hostage, while we debate the merits of another tax cut for the other two percent."

- CNN's Tom Cohen and Jeanne Sahadi contributed to this report.


Filed under: 2012 • Iowa • President Obama • Taxes • White House
soundoff (44 Responses)
  1. Wire Palladin, S. F.

    Billionaires are not creating jobs. The Kochs made over $26 billion last year, and then cut their workforce. What will grow jobs is a tax cut for the middle class and the poor because they will spend the money on goods. The Kochs will only use it to buy the GOP and negative ads against the president.

    July 10, 2012 04:20 pm at 4:20 pm |
  2. IF YOU SIGNED GROVER'S PLEDGE, YOU ARE A TRAITOR TO THE U.S.

    Once again the GOP is holding the middle class hostage. I want to check their birth certificates to make sure they're not Iranians.

    July 10, 2012 04:22 pm at 4:22 pm |
  3. Sniffit

    "Republicans have sharply opposed the president's policy, saying it could severely affect small business owners. "

    Enter reality stage right:

    Congress’s nonpartisan Joint Committee on Taxation found that in 2013, just 3.5% of small businesses would pay a higher rate — about 940,000 individuals, many of whom are lawyers and doctors in partnerships.

    So, again, we have GOPers/Teatrolls inventing their own reality that they'd prefer to live in, instead of living in the real one with the rest of us.

    July 10, 2012 04:22 pm at 4:22 pm |
  4. Donkey Party

    It's clear you right-wingers are ignorant beyond all comprehension, but the "Bush tax-cuts" were created by the GOP with a built-in END DATE. When they expire, blame the GOP, you knuckle-dragging cretins. It's a Bush / GOP tax hike, not a President Obama tax hike. And besides, pay your fair shares, you something for nothing, free-loading right-wing sub-humans.

    July 10, 2012 04:25 pm at 4:25 pm |
  5. Jim

    I thought Obama wanted to end them for people making MORE than $250,000. Not sure how well his campaign will succeed if the last sentence of the first paragraph in this article is anything more than a Freudian slip.

    July 10, 2012 04:25 pm at 4:25 pm |
  6. obama victim

    tax increase...for anyone..during tough economic times?? what a moron

    July 10, 2012 04:29 pm at 4:29 pm |
  7. sonny chapman

    The US Economy KICKED BUTT when the tax rate was 39.5% on these same folks. It was called the CLINTON ECONOMY. The US Economy tanked when George W. Bush reduced the rate to 33%. The Repub. Mantra that ANY taxes kill jobs is part of their political/religious Faith. They cannot be dissuaded by FACTS.

    July 10, 2012 04:31 pm at 4:31 pm |
  8. BARACK HUSSEIN OBAMA has a FAILURE PROBLEM

    All of this is just a MASSIVE smoke and mirror distraction pitting one segment against another. Even if the "rich" are taxed more, it amounts to $70 billion a year and the deficits are $1300 BILLION. Where is the OTHER $1230 BILLION going to come from Obama and Democrats???? WHERE??? Gonna take EVERYTHING from the rich? STILL DOESN'T COVER THE $1230 BILLION!!

    All the Democrats have to offer are distractions and BS, aka smoke and mirrors. NO REAL SOLUTIONS. Which is exactly what Obama has shown over the last 4 years. Obama's been nothing but an empty suit lead around by the nose for 2 years by Reid and Pelosi. Since the American people stopped his insanity in 2010, he has refused to moderate his far left agenda. The ONLY option is to send him his pink slip in November. The country simply cannot afford 4 more years of Obama insanity.

    July 10, 2012 04:33 pm at 4:33 pm |
  9. sonny chapman

    Repubs. believe so firmly in what they believe, it's like a Force Field that will not allow any contradictory information to penetrate their minds.

    July 10, 2012 04:35 pm at 4:35 pm |
  10. Name JR

    He can always call hoLlande and the french they'll support him. NOT AMERICANS.

    July 10, 2012 04:39 pm at 4:39 pm |
  11. Dean

    Wouldn't mind paying more taxes if it was necessary and spent wisely.
    Since Obama is closing Gitmo here is $40 million that is going to be wasted.
    Via Washington Post:

    SAN JUAN, Puerto Rico — The U.S. military hopes to install a $40 million underwater fiber-optic cable that could improve communications at Guantanamo Bay, a military official said Thursday. The goal is to bring the infrastructure of the naval base up to par with other government agencies, said Army Lt. Col. Todd Breasseale, a spokesman for the Guantanamo military commissions. Currently, the base relies on a single satellite for its communications system. “It feels like the sort of dial-up Internet that we had in the 90s,” Breasseale said. “It’s a very limited bandwidth.” He said the cable would run 800 miles (1,290 kilometers) from Guantanamo Bay to South Florida and could start operating within two years. Cuban authorities have been notified about the project, and the survey ship USNS Zeus is expected to arrive at the naval base in upcoming weeks.

    July 10, 2012 04:43 pm at 4:43 pm |
  12. Peggy

    President Obama is right and the Republicans are wrong, very wrong. If denying the Bush Tax Cuts to the rich will destroy jobs, then allowing them should create jobs. Just in case we have not been paying attention, we have had those cuts and the jobs have been running out of the country. The tax cuts for the rich do not and will not create jobs. Now, creating mischief is another story altogether.

    July 10, 2012 04:51 pm at 4:51 pm |
  13. 23 from Texas

    Wow, this POTUS is a snake. I wish we had someone that knows at least the main points of economics 101. But no, instead we have someone who is economically retarded. Way to go BO.

    July 10, 2012 04:53 pm at 4:53 pm |
  14. Silence DoGood

    @Dean "Since Obama is closing Gitmo"

    Actually he just promised that. He got the votes. For 2012 he will probably promise that all over again. And get more votes.

    Mr.President – keep your promises.

    July 10, 2012 05:02 pm at 5:02 pm |
  15. obama victim

    anyone really believe this additional revenue would be spent wisely?? we are talking about Barry here.............seems he is going for the idiot vote

    July 10, 2012 05:06 pm at 5:06 pm |
  16. Sniffit

    "@Dean "Since Obama is closing Gitmo"

    Actually he just promised that. He got the votes. For 2012 he will probably promise that all over again. And get more votes.

    Mr.President – keep your promises."
    =======

    Mr. DoGood – Recognize when something didn't happen because Congress wouldn't let it, rather thanblaming the POTUS as though he can just wave magic wands to make things happen.

    REALITY: GOP/Teatroll strategery from the GET-GO was to block and prevent and frustrate and obstruct, paying special attention to killing as much of what Obama promised as possible, starting with bipartisanship and compromise.

    July 10, 2012 05:12 pm at 5:12 pm |
  17. Peace

    @obama victim

    tax increase...for anyone..during tough economic times??
    ----–
    No sign of tough economic times for the rich. If there was, they couldn't throw money the way they are doing to Super PACs.

    July 10, 2012 05:16 pm at 5:16 pm |
  18. Mikey

    @victim mentality – "anyone really believe this additional revenue would be spent wisely??"
    *******************************************************************
    It would reduce the deficit. Perhaps you are still in the pre-1/30/2009 GOP camp when "deficits don't matter", not the immediate flip flop to anti-defict rallies on the mall in DC within 40 days of Obama taking office. Same as saying that Obama would "cut and run" in Iraq and Afghanistan and then criticizing him for not ending the wars sooner. Romney is your perfect flip-floppy candidate.

    ALL taxpayers will benefit from President Obama's proposal. The wealthy will benefit from lower taxes on the brackets up to $250,000. For example, take a married couple making a combined $400,000. They probably have something near $100,000 in deductions and exemptions, etc. If their taxable income is $300,000, they would pay the extra 4% on the last $50,000 of their taxable income. So their total increase in taxes would be near $2,000, or about 1/2% of their total income.

    July 10, 2012 05:20 pm at 5:20 pm |
  19. granny

    Please leave the rich alone. I'm 73 years old I never once got a job from a poor man.

    July 10, 2012 05:21 pm at 5:21 pm |
  20. Susan in NC

    "Idiot vote"? I don't this so....... The tax increase that would remain in effect is for people "clearing" $250,000 - NET $250,000 - believe me, that's not many folks that I know nor is it many folks that most people know. I totally agree with President Obama on this one.

    ObamaCares

    July 10, 2012 05:23 pm at 5:23 pm |
  21. Sniffit

    "@obama victim

    tax increase...for anyone..during tough economic times??
    --–
    No sign of tough economic times for the rich. If there was, they couldn't throw money the way they are doing to Super PACs."

    ====

    Not to mention the objectively verifiable FACT that they were spending money like gangbusters all throughout the receission and still are now after th recession ended and while we're still in a slow recovery. Sales of Mercedes and BMWs were up, sales at places like Tiffany's were up, Gucci, Armani, you name it...the numbers don't lie. If it was a luxury item that could be used once and then discarded or flawnted for a couple months to make sure the neighbors and fellow country club members knew you were keeping up or besting them, then they were buying it and will buy it while you ate/eat catfood for breakfast before burying your starved cat in the backyard.

    July 10, 2012 05:31 pm at 5:31 pm |
  22. Four and The Door

    Since the Obama Administration is incapable of managing the federal government more efficiently, as long as they are in town we just have to pony up more cash. And debt. Not a great deal since they are not delivering anything they promise. We can do better. We know a guy who has a very good record of delivering results and not just talk. Romney 2012.

    July 10, 2012 05:34 pm at 5:34 pm |
  23. Sniffit

    "But the wealthy would still benefit if the Bush tax cuts are preserved for everyone else, since some of their income is also taxed at the lower rates of 10%, 15%, 25% and 28%."

    THis is an excellent point and bears repeating...INCESSANTLY. Here's how it works...

    Let's say Mr. Droolcup makes $500K per year. Taxes go down 2% for "those making less than $250K" (a frequent and purposeful misnomer used by the MSM to perpetuate the controversy), and taxes go up by 4% for "people making over $250K." The calculation of the net change in tax liability looks like this:

    $250K x -.02 = $5,000 SAVED

    $250K x +.04% = $10,000 ADDITIONAL TAX

    $10K – $5K = $5,000 NET ADDITIONAL TAX

    $5,000/$500,0000 = ONE PERCENT EFFECTIVE TAX INCREASE

    So, don't be fooled when the GOP/Teatrolls gloss over the actual math and the net effective tax increase involved in order to claim that it's a "4% tax increase." It's not and that's not at all how it works.

    July 10, 2012 05:37 pm at 5:37 pm |
  24. IF YOU VOTED FOR HUSSEIN OBAMA YOU'RE A COMMUNIST

    Hussein can call for all he want's, we're not buying it anymore.

    July 10, 2012 05:40 pm at 5:40 pm |
  25. Florida for Obama

    Only greedy people oppose what Obama proposed about tax cut....
    I don't know why some GOP supporters can not understand Obama's statement..or maybe those people are so blind and deaf..or maybe they do not know how to use calculator....poor GOP or greedy people....Vote for Obama...

    July 10, 2012 05:52 pm at 5:52 pm |
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