WASHINGTON | Thu Nov 4, 2010 11:01pm EDT
WASHINGTON (Reuters) - A conciliatory White House said on Thursday it was willing to negotiate with Republicans on tax cut extensions, but Senate Republican leader Mitch McConnell took a hard line against compromises with President Barack Obama in a new Congress.
In the first possible policy shift since Democrats suffered heavy election losses two days ago, White House spokesman Robert Gibbs signaled Obama was open to talks on a temporary extension for the wealthy of Bush-era tax cuts that expire at the end of the year.
The fight over tax cuts looms as one of the biggest clashes since the election between Obama and Republicans, who will control the House of Representatives in the new Congress that convenes in January.
Obama invited top leaders from both parties to a meeting and a dinner at the White House on November 18, and he said the tax cuts will top the agenda.
Obama has insisted on keeping the tax cuts for families making less than $250,000, but let them expire for wealthier Americans, while Republicans want them extended for all income levels. If no agreement is reached, all Americans will see higher tax rates on January 1.
But White House spokesman Robert Gibbs said the president was willing to discuss keeping all lower tax rates, at least temporarily.
"He'd be open to having that discussion and open to listening to what the debate is on both sides of that," Gibbs told reporters, later emphasizing the cuts for high earners would not continue forever.
"The president does not believe -- and I think would not accept -- permanently extending the upper-end tax cuts," Gibbs said.
NO MOOD TO COMPROMISE
Republican leaders did not directly respond to the White House comments on tax cuts, but in a morning speech at the Heritage Foundation McConnell made it clear he was in no mood to compromise with Obama.
McConnell defended his earlier remarks that his top priority would be ensuring Obama is a one-term president and said Republicans would try to repeal Obama's sweeping healthcare overhaul but might have to settle for smaller changes.
"Some have said it was indelicate of me to suggest that our top political priority over the next two years should be to deny President Obama a second term in office," McConnell said.
"But the fact is, if our primary legislative goals are to repeal and replace the health spending bill, to end the bailouts, cut spending and shrink the size and scope of government, the only way to do all these things is to put someone in the White House who won't veto any of these things," he said.
The broad election triumph by Republicans on Tuesday changed the political calculation for both parties, emboldening Republicans who gained at least 60 House members and six more senators and forcing the White House to reconsider its approach. As of Thursday, the Democrats held 51 Senate seats with Sen. Patty Murray's projected win in Washington state.
During the weeks before the election, Obama campaigned against extending tax cuts for high-earners, saying the United States could not afford the $700 billion it would cost over 10 years while trying to tame the budget deficit.
source : http://www.reuters.com/article/idUSTRE69U1KM20101105
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