GWEN IFILL: Tax politics returned to center stage in Washington today, as President Obama called for extending middle-class tax cuts and Mitt Romney said the White House plan doesn't go nearly far enough.
GWEN IFILL: The White House East Room was the backdrop for a presidential pivot today: moving away from talk of joblessness to promises of tax cuts.
PRESIDENT BARACK OBAMA: The Republicans say they don't want to raise taxes on the middle class. I don't want to raise taxes on the middle class. So we should all agree to extend the tax cuts for the middle class. Let's agree to do what we agree on, right?
BARACK OBAMA: That's what compromise is all about. Let's not hold the vast majority of Americans and our entire economy hostage while we debate the merits of another tax cut for the wealthy.
GWEN IFILL: The president is reviving his proposal to extend existing tax cuts at the end of the year, but only for those who earn $250,000 or less annually.
Allowing those cuts to expire, he said, would be a big blow to working families and a drag on the entire economy. The one-year tax cut extension the president proposes would cost $150 billion. Allowing the cuts to expire for those who earn more would generate $850 billion over the next decade.
But $1.2 trillion in automatic spending cuts are already scheduled to begin taking effect early next year. Lawmakers agreed to those cuts as part of last year's deal to raise the debt ceiling. The Romney campaign today called the president's proposal a political statement that would hurt, rather than help, taxpayers.
Romney spokesperson Andrea Saul said in a statement: "President Obama's response to even more bad economic news is a massive tax increase. It just proves again that the president doesn't have a clue how to get America working again and help the middle class."
Other Republicans offered a similar critique in advance of the president's remarks. Senate Republican Leader Mitch McConnell told CNN the president's plan would make a bad problem worse.
SEN. MITCH MCCONNELL, R-Ky.: And we have got the fiscal cliff coming at the end of the year. You know, what we ought to be doing is extend the current tax rates for another year with a hard requirement to get through comprehensive tax reform one more time.
GWEN IFILL: Both campaigns are appealing to middle class pocketbooks at the same time they are adding record sums to their campaign coffers.
Today, Romney and the Republican National Committee reported raising $106 million last month, outstripping the president and the Democrats, who pulled in $71 million. Outside fund-raising groups are raising and spending millions more.
And all those dollar signs add up to a debate that could easily determine which party wins the White House and the Congress this fall.
For more on the politics behind the policy, we turn to NewsHour Political Editor Christina Bellantoni and Stuart Rothenberg of The Rothenberg Political Report.
Now, listening to the president just now, Christina, I was interested when he talked about the pivot point that we just mentioned. He said that the core mission is putting people back to work, but also rebuilding an economy where that work pays off.
Is that when you turn the corner from last week's bad news to try to redefining this week's?
CHRISTINA BELLANTONI: Yes, that's exactly what the president is trying to do. He likes this turf, being able to talk about what he would do for middle-class families, because the tax cut issue is the primary one.
And this is something he's been talking about for many, many years now. In 2007, his first campaign event, this was his biggest applause line, saying, I will get rid of these tax cuts for people that don't need them. And he's refined his language, come along on that issue. But it's certainly where he wants to be playing and not about the unemployment rate.
GWEN IFILL: But when the president uses terms like stalemate to describe where Congress is now, we have used other words over the years, gridlock, you name it. . .
STUART ROTHENBERG, The Rothenberg Political Report: Right.
GWEN IFILL: When he uses that word, is he talking about philosophy or is he talking strictly about politics?
STUART ROTHENBERG: I think about partisanship and politics.
It's about defining the Republicans as opposing any progress, so that at the end of the day, no matter what the new job numbers show and the unemployment numbers show, he can blame the Republicans, whether it's President Bush or frankly this Congress, and say they really haven't participated. They haven't helped me get this economy going.
GWEN IFILL: And right under the surface, it seems -- or maybe not under the surface, maybe right on the surface -- is this class war argument. That's what Republicans call it. He calls it a fairness argument.
Does that stick? And is that what this was about today?
STUART ROTHENBERG: Well, I don't know. I guess we're going to see whether it sticks.
Historically, it hasn't stuck all that well. Right now, people seem focused on, how is the president doing? How is the economy doing? Are we getting jobs? And, as Christina says, the White House is trying to change the subject. It's a very reasonable strategy. I think it's a bit of an uphill one. But it's not an impossible one.
GWEN IFILL: Do the polls tell us anything about who wins that kind of argument, Christina?
CHRISTINA BELLANTONI: Well, a lot polls say that it's a popular idea to tax the rich more. Right? More Americans think that that's OK.
But there's a lot of nuance in those polls as well. And one thing that is also interesting that polls show is that Congress is about the most unpopular thing in the country right now. And so Barack Obama likes to campaign against Congress. When he's locked in this very tight battle with Mitt Romney, where the two of them are just a few points apart, it's much easier to campaign against somebody that has a 10 percent approval rating or 12 percent approval rating than your opponent.
GWEN IFILL: When he says something like he just said, let's agree on what we agree on, why isn't that eminently reasonable? Why won't that work?
CHRISTINA BELLANTONI: Because nobody wants to take these votes in an election year where they actually have to accomplish something. It's much easier to have to put their stamp on you.
And Republicans will come out with a counterproposal in the House.
STUART ROTHENBERG: And think about what he said, Gwen. He said, this is my position. It's also the Republicans' position. So why can't they compromise with me on this?
STUART ROTHENBERG: I think the Republicans will say, what he wants them to do is cave on tax cuts for all and not compromise.
GWEN IFILL: And the other thing the Republicans seem to be doing is they're about their own definitions right now too. They're talking about the president's zombie economy, which the jobless numbers help support, right?
STUART ROTHENBERG: Oh, they bring it always back to jobs. And the sense that the economy has not recovered.
Remember, this is a battle over what the election is about. The Democrats want it to be about certain things. The Republicans want it just to be about jobs, the new jobs numbers, the employment numbers.
GWEN IFILL: Is it fair to say the Democrats want it to be about Mitt Romney's elitism and jet skis and his offshore accounts and outsourcing, and the Democrats want -- the Republicans want it to be about Barack Obama's failed presidency?
CHRISTINA BELLANTONI: That's exactly what they both want it to be about. And whether it's more about what we're talking about, how Americans feel about this economy, is the big question because it does -- there are multiple polls that are showing a lot of different tests of voters that they are being affected by negative messaging that's coming overwhelmingly from the Obama campaign.
But it's going to be coming from all sides. And this is a core issue, that the economic argument of, who is for you, who is for the little guy? Barack Obama is trying to say that that's him.
GWEN IFILL: Do these arguments trickle down at all to state races and to Senate competitions, to battleground states?
STUART ROTHENBERG: Absolutely. I have already gotten emails today.
Tom Smith, the Republican Senate candidate in Pennsylvania, says, see, Bob Casey and the president are on the same page. They want higher taxes. Chris Shays, a moderate Republican when he was in the House, now running for the U.S. Senate, I got an e-mail from him today: There goes the president, higher taxes.
So, Republicans believe they can jump on this message. Now, there are parts of the country, congressional districts and states, where the Democratic message about fairness works well. But Republicans think that -- they always like to talk about taxes and higher taxes and bigger government.
CHRISTINA BELLANTONI: And the Democrats that I talked to today feel very similarly. They like having this argument as well.
They say, well, if we want to have this debate over who is going to help the middle class more, we will talk about that and we will be able to point to Republicans who just want to help the rich.
GWEN IFILL: Meanwhile, the Republicans, they are all raising money hand over fist. Mitt Romney raised $4 million in the Hamptons. The president let -- this weekend -- the president had two campaign fund-raisers today.
And the president sent out this SOS email -- or the president's campaign -- saying, help, help, we're going to be beat.
Which one of these things gained traction, or is it a wash, the money thing?
CHRISTINA BELLANTONI: There is going to be plenty of money thrown around. Everybody is going to have enough of it. But they are each going to sort of raise the temperature by saying this other guy is going to outspend us and we're going to be completely underwater by their big cash.
STUART ROTHENBERG: I think what happens is you have so much money, so many messages countering one another that voters, particularly swing voters, there's a default position.
The Republicans support Republicans, Democrats, Democrats. And swing voters, I'm not sure exactly what their default is. That's the danger for both parties.
GWEN IFILL: Maybe it's not how the money is raised, but what it is spent on. Part two of our conversation for another night.
Thank you, Christina and Stu.
CHRISTINA BELLANTONI: Thank you.
STUART ROTHENBERG: Sure.