“We can’t just cut our way out of this hole,” the president said in the speech. He noted that he is among the millionaires who should face higher tax rates than the middle class and said: “For us to solve this problem, “It’s only right we ask everyone to pay their fair share.” “I reject the idea that asking a hedge fund manager to pay the same tax rate as a plumber or teacher is class warfare.” The president also warned Republicans that he will veto any bill that trims health-care for the elderly without raising taxes on the rich.
Obama’s recommendation to a joint congressional committee served as a sharp counterpoint to Republican lawmakers, who have insisted that tax increases should play no part in taming the nation’s escalating national debt. The new taxes predominantly would hit wealthy Americans, ending their Bush-era tax cuts and limiting their deductions.
Senate Republican leader Mitch McConnell said: “Veto threats, a massive tax hike, phantom savings, and punting on entitlement reform is not a recipe for economic or job growth – or even meaningful deficit reduction.”
Republican Presidential contenders , Mitt Romney and Texas Governor Rick Perry, released short statements with a simple message: No New Taxes.
The President’s proposals would bring total deficit cutting plans over the next decade to $4.4-trillion, officials said. That top-line figure includes $1.2-trillion in cuts in federal discretionary spending already agreed by Obama in August as part of a compromise which ended a standoff with Republicans over raising the federal debt ceiling. It includes $580-billion in spending cuts across all mandatory spending programs and $1.1-trillion of savings realized from drawing down US troop numbers in Afghanistan and Iraq.