Obama Calls for New Taxes on Wealthy in $3 Trillion Deficit Reduction Plan

President Obama will call for $1.5 trillion in new taxes as part of plan to find more than $3 trillion in savings. Photo by Chip Somodevilla/Getty Images.

If you’re one of our many readers who had hoped the toxicity of the debt ceiling debate this past summer and the tumbling poll ratings for politicians of all stripes that followed would spark a breakthrough of compromise in Washington, you may want to stop reading here.

When President Obama takes to the Rose Garden at 10:30 a.m. ET Monday, he’s expected to urge the congressional “super committee” charged with finding $1.2 to $1.5 trillion in deficit reductions to go far beyond that goal. The president will put forth his preferred path to nearly $3 trillion in deficit savings over the next 10 years.

The president plans to achieve that figure through a mixture of tax increases on individuals who earn more than $200,000 per year and families who earn in excess of $250,000 per year. Roughly half of his proposed $1.5 trillion in tax increases comes from allowing the Bush-era tax cuts for those high earners to expire. The other half comes from closing tax loopholes and limiting itemized deductions, a tax policy prescription that has yet to produce overwhelming support within his own party in addition to the existing wall of Republican opposition.

The other half of the savings in his overall $3 trillion deficit reduction plan comes from the unwinding of the wars in Iraq and Afghanistan ($1.1 trillion) and $580 billion in savings from adjustments in Medicare, Medicaid and other health and entitlement programs. The Medicare proposal stays clear of raising the eligibility age from 65 to 67, a controversial proposal reportedly on the table in the Obama-Boehner talks last July.

Also included in the president’s pitch will be his “Buffett Rule,” which takes its name from investor billionaire Warren Buffett, who often criticizes the fact that his employees tend to pay taxes at a higher rate than he does.

“If he’s feeling guilty about it, I think he should send in a check,” Senate Minority Leader Mitch McConnell, R-Ky., said of Buffett’s critique on NBC’s “Meet the Press” Sunday. “But we don’t want to stagnate this economy by raising taxes….There’s bipartisan opposition to what the president is recommending already,” he added in a preview of the stern opposition expected to flow from Republicans on Capitol Hill and the campaign trail.

Whether it was President Bill Clinton promising to “make the rich pay their fair share” in his 1992 campaign literature or Al Gore’s “people versus the powerful” message in 2000, Democratic presidents or presidential aspirants long before President Obama have sought to stir populist middle-class support against what they see as a troublesome trend of growing economic inequality in America that puts more of the country’s wealth in the hands of a small slice of the population at the upper end of the income scale.

So it will be nothing new for President Obama to hear charges of “class warfare” from his Republican opponents when he steps back inside the Oval Office after his remarks.

However, it’s crystal clear that the president’s mission Monday is not to persuade Republicans to cross the aisle and support his plan for deficit reduction. He’s simply drawing the dividing lines that will help define the 2012 election.

One key component for President Obama’s re-election effort is to shore up support among his Democratic base. By promising to veto anything the super committee sends him that relies solely on spending cuts without any tax increases on the wealthiest Americans, he will aid himself in that effort. In addition, his refusal to delve too deeply into entitlement reform will also be welcome news among his most liberal supporters.

“I am very encouraged by the president’s focus on the need for tax reform that calls on all Americans to contribute their fair share. And while we await the specific details of the President’s full proposal, we remain committed to strengthening Medicare and Medicaid,” House Democratic Leader Nancy Pelosi, D-Calif., said in a statement issued Sunday night in advance of the president’s remarks.

SENDING A MESSAGE

Indiana Gov. Mitch Daniels has some company when it comes to his feelings about the Republican presidential field.

The latest CBS News/New York Times poll released over the weekend revealed that 43 percent of Republican primary voters said they were satisfied with the GOP field, while 50 percent of respondents said they wanted more choices.

Daniels ruled out a presidential bid of his own four months ago, and over the weekend he told Jeff Zeleny of the New York Times that he had been frustrated by the discourse in the GOP campaign and suggested there was still room for one more candidate to enter the field — someone who could speak with authority about the need for fiscal discipline.

“‘Somebody else could still enter and have a competitive chance,’ Mr. Daniels said in a weekend interview. ‘The candidate I could get instantly excited about is someone who is willing to level with the American people and assume they are prepared to listen to the mathematical facts and agree that whatever other disagreements we have aren’t as important.'”

Daniels told Zeleny that Texas Gov. Rick Perry’s recent entrance showed that there was still time for another candidate to make a run for the party’s nomination.

“‘He proved it wasn’t too late — I don’t think it’s too late yet,’ Mr. Daniels said, noting that he had ‘tried to recruit three or four people.'”

He added, ‘In the wired world we’re in, somebody new could get in.'”

Could that somebody be New Jersey Gov. Chris Christie, who has ruled out running for president so many times that we’ve lost count?

Well, Paul Gigot of the Wall Street Journal columnist said on “Fox News Sunday” that Christie was now considering a run, despite his repeated denials of such a move.

“I think that enough people have gone to him now and said, ‘Look, this field is weak and none of them may be able to beat the president. We need a Republican president. We think you can do it. Now is your moment,'” Gigot said.

We’ll see if the Garden State governor has yet another colorful way to dismiss the latest bit of presidential speculation or if he happens to leave the door open this time around.

PLAYING POLITICS

In recent weeks, former Vice President Dick Cheney has praised Hillary Clinton’s performance as secretary of state and even encouraged her to launch a primary challenge against President Obama.

On Sunday, former President Bill Clinton paid the compliment back to Cheney, but suggested the Republican might have an ulterior motive in praising his wife, the Obama administration’s top diplomat.

“You know, I’m very proud of her, and so I’m always gratified whenever anyone says anything nice about her,” Clinton said on CBS’ “Face the Nation.”

“But I also have a high regard for Vice President Cheney’s political skills. And I think one of those great skills is sowing discord among the opposition,” Clinton added. “I don’t want to help him succeed in his political strategy, but I admire that he’s still out there hitting the ball.”

In a later, separate interview with “Face the Nation” host Bob Schieffer, Cheney said he was pleased Clinton thought his idea had “some merit,” but the former vice president insisted that politics had nothing to do with the suggestion.

“No, I just thought Bob, that the Democrats ought to have as much fun on their side as we are having on our side figuring out who is going to run,” Cheney said.

ON THE TRAIL

All events listed in Eastern Time.

• President Obama delivers remarks on deficit reduction at 10:30 a.m., and later travels to New York City for the United Nations General Assembly and a Democratic National Committee fundraiser.
• Former Pennsylvania Sen. Rick Santorum addresses the Bedford Republican Breakfast in Bedford, N.H., at 7 a.m.
• Minnesota Rep. Michele Bachmann tours Sukup Manufacturing in Sheffield, Iowa, at 1 p.m. and visits OMJC Signals in Waterloo, Iowa, at 4 p.m.
• Former House Speaker Newt Gingrich holds a documentary film screening in Council Bluffs, Iowa, at 7 p.m.

For all future campaign events be sure to check out our Political Calendar.

For more political coverage, visit our politics page.

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