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| Obama Details Lines of Battle in Plan for Taxes and Budget | |
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| WASHINGTON — President Obama, riding the winds of re-election, signaled Wednesday that he was prepared to battle with Republicans over budget negotiations and his national security team’s handling of the deadly attack on an American mission in Libya. | WASHINGTON — President Obama, riding the winds of re-election, signaled Wednesday that he was prepared to battle with Republicans over budget negotiations and his national security team’s handling of the deadly attack on an American mission in Libya. |
| Displaying a mix of resolve and restraint, Mr. Obama flatly rejected any budget deal that did not raise tax rates on income above $250,000 a year, even if it meant driving the economy into a recession. But he did not rule out a compromise that could leave the top tax rates lower than their levels during the Clinton administration, presumably combined with a restriction on some tax breaks for top earners. | Displaying a mix of resolve and restraint, Mr. Obama flatly rejected any budget deal that did not raise tax rates on income above $250,000 a year, even if it meant driving the economy into a recession. But he did not rule out a compromise that could leave the top tax rates lower than their levels during the Clinton administration, presumably combined with a restriction on some tax breaks for top earners. |
| For a president fresh off a hard-fought victory, Mr. Obama projected little of the triumphalism of other newly re-elected leaders like Ronald Reagan and George W. Bush, who boasted in 2004 that he had amassed political capital and planned “to spend it.” | For a president fresh off a hard-fought victory, Mr. Obama projected little of the triumphalism of other newly re-elected leaders like Ronald Reagan and George W. Bush, who boasted in 2004 that he had amassed political capital and planned “to spend it.” |
| Mr. Obama instead cloaked his tough stance in the language of compromise, saying he was “familiar with all the literature about presidential overreach in second terms,” and that his re-election was not a mandate to ram his proposals through Congress without any concessions. | Mr. Obama instead cloaked his tough stance in the language of compromise, saying he was “familiar with all the literature about presidential overreach in second terms,” and that his re-election was not a mandate to ram his proposals through Congress without any concessions. |
| In his first formal news conference in eight months, which was meant to position Mr. Obama for the coming fiscal battles but ended up including a C.I.A. scandal and a vitriolic fight over who is to blame for the attack on the American diplomatic mission in Benghazi, Libya, the president saved his most fiery words to defend his ambassador to the United Nations, Susan E. Rice. Ms. Rice, a candidate for secretary of state, has come under withering attack from Senator John McCain and other Republicans for suggesting that the siege in Benghazi that killed four Americans was a spontaneous protest rather than a premeditated terrorist attack. | In his first formal news conference in eight months, which was meant to position Mr. Obama for the coming fiscal battles but ended up including a C.I.A. scandal and a vitriolic fight over who is to blame for the attack on the American diplomatic mission in Benghazi, Libya, the president saved his most fiery words to defend his ambassador to the United Nations, Susan E. Rice. Ms. Rice, a candidate for secretary of state, has come under withering attack from Senator John McCain and other Republicans for suggesting that the siege in Benghazi that killed four Americans was a spontaneous protest rather than a premeditated terrorist attack. |
| “For them to go after the U.N. ambassador, who had nothing to do with Benghazi and was simply making a presentation based on the intelligence that she had received, and to besmirch her reputation, is outrageous,” Mr. Obama said, his eyes flashing with anger. | “For them to go after the U.N. ambassador, who had nothing to do with Benghazi and was simply making a presentation based on the intelligence that she had received, and to besmirch her reputation, is outrageous,” Mr. Obama said, his eyes flashing with anger. |
| Describing Ms. Rice’s conduct as “exemplary,” he warned that her critics have “got a problem with me.” Almost daring them to a confirmation battle, he vowed to nominate Ms. Rice if he determined that she was the right person for secretary of state. | Describing Ms. Rice’s conduct as “exemplary,” he warned that her critics have “got a problem with me.” Almost daring them to a confirmation battle, he vowed to nominate Ms. Rice if he determined that she was the right person for secretary of state. |
| Mr. Obama’s remarks drew an equally angry response from Senators McCain and Lindsey Graham. In a statement issued after the news conference, Mr. Graham reiterated that he would oppose “anyone who is up to their eyeballs in the Benghazi debacle.” | Mr. Obama’s remarks drew an equally angry response from Senators McCain and Lindsey Graham. In a statement issued after the news conference, Mr. Graham reiterated that he would oppose “anyone who is up to their eyeballs in the Benghazi debacle.” |
| By contrast, the president struck an almost elegiac tone in discussing the sex scandal that forced the resignation of David H. Petraeus as director of the Central Intelligence Agency. Mr. Petraeus, he said, told him that he did not meet his own standards for holding the job. | By contrast, the president struck an almost elegiac tone in discussing the sex scandal that forced the resignation of David H. Petraeus as director of the Central Intelligence Agency. Mr. Petraeus, he said, told him that he did not meet his own standards for holding the job. |
| But, Mr. Obama added, “We are safer because of the work Dave Petraeus has done,” voicing hope that the scandal would end up as a “single side note on what has otherwise been an extraordinary career.” | But, Mr. Obama added, “We are safer because of the work Dave Petraeus has done,” voicing hope that the scandal would end up as a “single side note on what has otherwise been an extraordinary career.” |
| Mr. Obama was cautious in responding to questions about whether he should have been told earlier about the investigation into the relationship between Mr. Petraeus and his biographer, Paula Broadwell, with the president saying that he would leave it to the F.B.I. to explain its “protocols.” But while he offered no criticism of the investigation, he appeared to leave himself room to do so in the future, should new information emerge. | Mr. Obama was cautious in responding to questions about whether he should have been told earlier about the investigation into the relationship between Mr. Petraeus and his biographer, Paula Broadwell, with the president saying that he would leave it to the F.B.I. to explain its “protocols.” But while he offered no criticism of the investigation, he appeared to leave himself room to do so in the future, should new information emerge. |
| “I am withholding judgment with respect to how the entire process surrounding General Petraeus came up,” he said. | “I am withholding judgment with respect to how the entire process surrounding General Petraeus came up,” he said. |
| In laying out his position on the budget, Mr. Obama emphasized that debate over taxes had been central to the election he just won and reprised many of the themes he had struck on the campaign trail. The president urged Republicans to go along with his proposal to extend the Bush-era tax cuts on all personal income up to $250,000 a year, noting that people who made more than that amount would also benefit from such an extension. | In laying out his position on the budget, Mr. Obama emphasized that debate over taxes had been central to the election he just won and reprised many of the themes he had struck on the campaign trail. The president urged Republicans to go along with his proposal to extend the Bush-era tax cuts on all personal income up to $250,000 a year, noting that people who made more than that amount would also benefit from such an extension. |
| “But when it comes to the top 2 percent, what I’m not going to do is extend further a tax cut for folks who don’t need it, which would cost close to a trillion dollars,” Mr. Obama said. | “But when it comes to the top 2 percent, what I’m not going to do is extend further a tax cut for folks who don’t need it, which would cost close to a trillion dollars,” Mr. Obama said. |
| While he insisted that the tax cuts for income above $250,000 must expire, Mr. Obama did not stipulate that the top rate would revert to 39.6 percent, as it was in the Clinton administration. Mr. Bush signed a bill a decade ago reducing it to 35 percent, where it has remained. | While he insisted that the tax cuts for income above $250,000 must expire, Mr. Obama did not stipulate that the top rate would revert to 39.6 percent, as it was in the Clinton administration. Mr. Bush signed a bill a decade ago reducing it to 35 percent, where it has remained. |
| Mr. Obama’s stance appeared to leave room for the White House and Republicans to negotiate a tax rate somewhere in between and then raise additional revenue by restricting tax deductions and credits on high incomes. “I don’t expect Republicans simply to adopt my budget,” he said. “That’s not realistic. So I recognize that we’re going to have to compromise.” | Mr. Obama’s stance appeared to leave room for the White House and Republicans to negotiate a tax rate somewhere in between and then raise additional revenue by restricting tax deductions and credits on high incomes. “I don’t expect Republicans simply to adopt my budget,” he said. “That’s not realistic. So I recognize that we’re going to have to compromise.” |
| Still, Mr. Obama said he could envision a situation in which there was no agreement and all the tax cuts expired. Such an outcome would be a “rude shock” for middle-class people, he said, and could set off a recession. | Still, Mr. Obama said he could envision a situation in which there was no agreement and all the tax cuts expired. Such an outcome would be a “rude shock” for middle-class people, he said, and could set off a recession. |
| “It would be a bad thing,” he said. “It is not necessary.” | “It would be a bad thing,” he said. “It is not necessary.” |
| By suggesting he was willing to accept failed negotiations, Mr. Obama was in part trying to give himself more leverage than in 2010, when fears about the economy and its impact on his political standing caused him to reverse course and accept an extension of all the Bush tax cuts in exchange for additional stimulus. This time, however, the economy is somewhat stronger, Mr. Obama has no more elections in front of him — as he pointed out on Wednesday — and the package of budget changes set to take effect on Jan. 1 includes both tax increases and military cuts that Republicans generally oppose. | By suggesting he was willing to accept failed negotiations, Mr. Obama was in part trying to give himself more leverage than in 2010, when fears about the economy and its impact on his political standing caused him to reverse course and accept an extension of all the Bush tax cuts in exchange for additional stimulus. This time, however, the economy is somewhat stronger, Mr. Obama has no more elections in front of him — as he pointed out on Wednesday — and the package of budget changes set to take effect on Jan. 1 includes both tax increases and military cuts that Republicans generally oppose. |
| Speaker John A. Boehner, the effective leader of the Republican Party, said Republicans were not ready to accept Mr. Obama’s proposal because it would “hurt our economy and make job creation more difficult.” But he added that there was a “spirit of cooperation” that had infused Washington and that gave him optimism that some sort of deal would eventually come to pass. | Speaker John A. Boehner, the effective leader of the Republican Party, said Republicans were not ready to accept Mr. Obama’s proposal because it would “hurt our economy and make job creation more difficult.” But he added that there was a “spirit of cooperation” that had infused Washington and that gave him optimism that some sort of deal would eventually come to pass. |
| Republicans say they will find a way to raise enough money to reduce the deficit without lifting the top rates. Back-of-the-envelope math suggests that eliminating all tax breaks for the top 2 percent of households would raise about $2 trillion over 10 years, more than the $1.6 trillion that the White House demands, as part of a $3 trillion deficit-reduction package over 10 years. But having all of the additional tax revenue come from the restriction of tax breaks would require getting rid of virtually every such provision, like the home-mortgage deduction, in the tax code on top incomes. | Republicans say they will find a way to raise enough money to reduce the deficit without lifting the top rates. Back-of-the-envelope math suggests that eliminating all tax breaks for the top 2 percent of households would raise about $2 trillion over 10 years, more than the $1.6 trillion that the White House demands, as part of a $3 trillion deficit-reduction package over 10 years. But having all of the additional tax revenue come from the restriction of tax breaks would require getting rid of virtually every such provision, like the home-mortgage deduction, in the tax code on top incomes. |
| “The math tends not to work,” Mr. Obama said. | “The math tends not to work,” Mr. Obama said. |
| Allowing tax rates to rise on the wealthy — to the Clinton-era levels, or a few percentage points below them — puts much more money on the table and would allow more moderate changes to deductions, Democrats argue. | Allowing tax rates to rise on the wealthy — to the Clinton-era levels, or a few percentage points below them — puts much more money on the table and would allow more moderate changes to deductions, Democrats argue. |
| Looking beyond the immediate fiscal challenges, Mr. Obama expressed optimism about one major goal — immigration legislation — and caution about another, climate change. | Looking beyond the immediate fiscal challenges, Mr. Obama expressed optimism about one major goal — immigration legislation — and caution about another, climate change. |
| The president said he intended to pursue comprehensive immigration legislation, and noted that the election had prompted reflection among Republicans about their opposition to such an effort. Even as he criticized Mr. McCain on Benghazi, he cited his support for an overhaul of immigration law as an indication that it could pass. | The president said he intended to pursue comprehensive immigration legislation, and noted that the election had prompted reflection among Republicans about their opposition to such an effort. Even as he criticized Mr. McCain on Benghazi, he cited his support for an overhaul of immigration law as an indication that it could pass. |
| On climate change, Mr. Obama played down expectations for any major initiative. He spoke of holding a conversation with scientists and engineers about fresh ideas, but said more ambitious legislation would come only after the economy strengthened. | On climate change, Mr. Obama played down expectations for any major initiative. He spoke of holding a conversation with scientists and engineers about fresh ideas, but said more ambitious legislation would come only after the economy strengthened. |
| “We’re still trying to debate whether we can just make sure that middle-class families don’t get a tax hike,” he said. “That should be easy. This one’s hard.” | “We’re still trying to debate whether we can just make sure that middle-class families don’t get a tax hike,” he said. “That should be easy. This one’s hard.” |
Annie Lowrey contributed reporting. | Annie Lowrey contributed reporting. |