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 on Friday and said that Senate Democrats and
Republicans would work overtime this weekend to try to head off a $500bn time
bomb of tax hikes and spending cuts called the "fiscal cliff" before
a 1 January 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.
Groundwork for future
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 favour 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.
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