Obama calls for avoiding middle class tax hike

WASHINGTON – US President Barack Obama on Saturday urged Congress to protect the middle class from an income tax increase and lay the groundwork for future economic growth as Senate leaders begin work to avoid a so-called “fiscal cliff.”

“We’ve got to do what it takes to protect the middle class, grow this economy, and move our country forward,” Obama said in his weekly radio and Internet address.

“Leaders in Congress are working on a way to prevent this tax hike on the middle class, and I believe we may be able to reach an agreement that can pass both houses in time,” he added.

The comments came after Obama met with top congressional leaders Friday and said that Senate Democrats and Republicans would work overtime this weekend to try to head off a $500 billion time bomb of tax hikes and spending cuts called the “fiscal cliff” before a January 1 deadline.

The president, sensing a mandate from his re-election last month, wants to raise taxes on the rich but exempt the middle class. Republicans want only to close tax loopholes to raise revenue and demand significant spending cuts in return.

But if nothing is done by the deadline, everyone will get a tax hike.

Following the White House talks, Democratic Senate Majority Leader Harry Reid and Republican Minority Leader Mitch McConnell will now take the lead in seeking a deal before Tuesday.

But any agreement would also have to pass the House of Representatives, where there is doubt that any deal signed off by the Democratic president would win favor with restive conservatives in the Republican caucus.

But Obama warned that if an agreement was not reached in time, he would then ask the Senate to hold an up-or-down vote on a basic package that protects the middle class from an income tax hike, extends vital unemployment insurance for Americans looking for a job, and, as he put it, “lays the groundwork for future progress on more economic growth and deficit reduction.”

He did not elaborate.

“I believe such a proposal could pass both houses with bipartisan majorities – as long as these leaders allow it to come to a vote,” the president said. “If they still want to vote no, and let this tax hike hit the middle class, that’s their prerogative – but they should let everyone vote.”