Obama reiterates call to end top tier of Bush tax cuts

CLEVELAND - Politically weakened but refusing to bend, President Barack Obama insisted Wednesday that Bush-era tax cuts be cut off for the wealthiest Americans, joining battle with Republicans - and some fellow Democrats - just two months before bruising midterm elections.

Singling out House GOP leader John Boehner in his home state, Obama delivered a searing attack on Republicans for advocating "the same philosophy that led to this mess in the first place: cut more taxes for millionaires and cut more rules for corporations."

Obama rolled out a trio of new plans to help spur job growth and invigorate the sluggish national economic recovery. They would expand and permanently extend a research and development tax credit that lapsed in 2009, allow businesses to write off 100 percent of their investments in equipment and plants through 2011 and pump $50 billion into highway, rail, airport and other infrastructure.

The package was assembled by the president's economic team after it became clear that the recovery was running out of steam. There was a political component, too: With Democrats in danger of losing control of the House in November, Obama is under heavy pressure to show voters that he and his party are ready to do more to get the economy moving and get millions of jobless Americans back to work.

However, none of Wednesday's proposals, nor Obama's call for allowing tax rates to rise for the wealthiest Americans, seems likely to be acted on by Congress before the elections, reflecting the battering Obama and congressional Democrats have taken in public opinion polls.

Obama acknowledged recovery had slowed noticeably, with unemployment hovering just under 10 percent, and admitted his economic policies had not worked as quickly as hoped. But he said his party and proposals were still better placed to boost the U.S. economy.

Obama made one of his strongest appeals yet to allow the tax cuts passed under President George W. Bush - in 2001 and 2003 - to expire at the end of the year on schedule, but just for individuals earning more than $200,000 annually or joint filers earning more than $250,000.

But the president argued that the rich are more likely to save additional money than spend it.

"For any income over this amount, the tax rates would go back to what they were under President Clinton," Obama said. "This isn't to punish folks who are better off - God bless them - it is because we can't afford the $700 billion price tag."

With Reuters