WASHINGTON — President Barack Obama plans to make a public case this week for his strategy for dealing with the looming “fiscal cliff,” traveling to the Philadelphia suburbs Friday as he pressures Republicans to allow tax increases on top earners while extending tax cuts for families earning $250,000 or less.
The White House said Tuesday that the president intends to hold a series of events aimed at building support for his approach to avoid across-the-board tax increases and steep spending cuts in defense and domestic programs. Obama met with small-business owners at the White House on Tuesday and will meet with middle-class families today.
Obama’s strategy is twofold: negotiate in private with Republicans while taking his agenda outside the Beltway only weeks after winning reelection. The president’s visit to a small business in Hatfield, Pa., that makes parts for a construction-toy company will cap a week of public outreach as the White House and congressional leaders seek a way to avoid the tax increases and spending cuts scheduled to take effect Jan. 1.
Obama’s tactics were quickly panned by Senate Republican leader Mitch McConnell, R-Ky., who said Tuesday that “rather than sitting down with lawmakers of both parties and working out an agreement, he’s back out on the campaign trail, presumably with the same old talking points we’re all familiar with.”
“If the president wants a solution to the challenges of the moment, the people he needs to be talking to are the members of his own party so he can convince them of the need to act,” McConnell said.
Senate Majority Leader Harry Reid said Tuesday that Democrats and Republicans have made little headway in negotiations over how to avoid the fiscal cliff.
“There’s been little progress with the Republicans, which is a disappointment to me,” Reid, a Nevada Democrat, told reporters in Washington.
Reid said that after a Nov. 16 White House meeting, Republicans backed away from earlier openness to considering new tax revenue as part of a yearend deal to avert the cliff.
“They talked some happy talk about doing revenues, but we only have a couple weeks to get something done,” Reid said. “So we have to get away from the happy talk and start talking about specific things.”
Still, Reid also said he was “extremely hopeful, and I do not believe that the Republicans are going to allow us to go over the cliff.”
McConnell said Democrats are politicizing the talks.
“My advice to the president would be it seems like our friends on the other side are having some difficulty, kind of, turning off the campaign,” Mc-Connell told reporters.
House Speaker John Boehner, R-Ohio, has pushed for raising additional revenue through the reduction of tax provisions instead of raising tax rates on top earners and Republicans have said Democrats need to come up with cuts in entitlement programs such as Social Security and Medicare.
The White House has countered that the president will not sign legislation that extends current tax rates for the top 2 percent of income earners, or those households with incomes over $250,000. White House officials have expressed a willingness to discuss changes to Medicare and Medicaid but oppose addressing Social Security as part of the fiscal cliff discussions.
Obama campaign manager Jim Messina said in an e-mail to supporters after the election that the president’s volunteer base was crucial to his re-election but said they had “more progress to make, and there’s only one way to do it: together.”
After the election, Obama aides asked supporters to record YouTube videos discussing the need to have the wealthiest Americans pay more in taxes. Some of the people who shared their stories on YouTube planned to join Obama at the White House today.
House Republicans planned to hold events in the coming weeks with small businesses in their districts to emphasize the effect that tax increases could have on small business and their employees.
While official Washington is focused on potential tax hikes and automatic spending cuts, another fiscal crisis looms on the horizon. A report released Tuesday warned that the federal government is likely to hit a ceiling on issuing new debt come late December and could begin defaulting on obligations by mid-February.
The report from the Bipartisan Policy Center, a policy think tank, also highlighted why there’s less room for the Treasury Department to maneuver than during last year’s debt ceiling controversy. The center warned that financial markets may see greater turmoil than in 2011.
The government should hit its $16.394 trillion debt limit during the final week of December, according to the center. The Treasury Department can, as it did in 2011, turn to a number of extraordinary measures to avoid defaulting on the debt it has already issued. The juggling act by the Treasury is likely to run out, however, somewhere around mid-February.
Information for this article was contributed by Ken Thomas of The Associated Press; by Kathleen Hunter, Roxana Tiron, Mike Dorning, Margaret Talev, Phil Mattingly, Julie Bykowicz, Richard Rubin, Hans Nichols, Heidi Przybyla, Zachary Tracer and Noah Buhayar of Bloomberg News and by Kevin G. Hall of McClatchy Newspapers.
Front Section, Pages 4 on 11/28/2012