President Barack Obama has shown the first sign that he is willing to consider entitlement reforms as part of a deal to avert the so-called “fiscal cliff” that the nation is set to plunge off in less than a month.
But he made it clear that any agreement to “strengthen” Medicare and Social Security would only come if Republicans caved on the idea to raise taxes on the wealthiest Americans.
“I can’t ask folks who are middle-class, seniors who are on Medicare or young people who are trying to get student loans to go to college to sacrifice by not getting anything from higher-income folks,” Obama told Bloomberg in his first television interview since winning re-election.
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The president said that if revenues are to increase to match “very tough cuts” that he has already made, combined with entitlement reforms “we’re going to have to see rates on the top 2 percent go up.
“It’s not me being stubborn; it’s not me being partisan. It’s just a matter of math,” he said.
Obama did not answer a question as to whether he would be prepared to accept a lower increase in rates for the wealthy than the 39.6 percent that he is now proposing.
When it came to adjustments to entitlement programs, he said, “I am willing to look at anything that strengthens our system,” while at the same time saying he was not looking at cuts to benefits.”
However Rep. Steny Hoyer of Maryland, the number two Democrat in the House insisted that entitlement benefit cuts are already “clearly on the table.”
“They were on the table in the Boehner-Obama talks. They’ve been on the table for some period of time,” said Hoyer. “That does not mean that I’d be prepared to adopt them now, but they’re clearly, on the table.”
Hoyer also said that the GOP plan to reduce cost-of-living increases to some federal programs — including food stamps — should also be considered in the fiscal cliff talks.
During the Bloomberg interview, Obama said he recognizes that Republicans should not accept any raise in taxes with the promise of future entitlement cuts, saying there would be immediate “down payments” on their demands with more sweeping changes to come next year.
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But the president said that the Republican counteroffer that House Speaker John Boehner had presented was “out of balance.”
“We’re not going to be able to get a deal without it,” Obama told interviewer Julianna Goldman.
After the interview, Goldman said Obama recognizes that “he has got a lot of flexibility when it comes to entitlement spending — that’s going to be a must.”
But she added, “In return Republicans are going to have to cave on their insistence that rates do not get touched for the wealthy.”
Goldman said it seems that both sides are still posturing. “Ultimately it is going to come down to President Obama and House Speaker John Boehner actually getting into a room, sitting down face-to-face and working out some of these tough issues between the two of them.”
Obama’s interview gained mixed reviews from Republicans. Sen. Tom Cole of Oklahoma, who has suggested allowing tax rates on the wealthy to increase said the president appeared to be moving in the right direction, while Rep. Walter Jones of North Carolina called it “hopeful.”
“If there’s going to be an increase, but less than anticipated, that’s a good point to talk,” said Jones.
But Senate Minority Leader Mitch McConnell said talks are still not going well. “We’ve wasted an enormous amount of time sparring back and forth in public, and it strikes me as a good time to get serious about the proposals.
“I had hoped we would be accomplishing more in the real talks that are going on privately,” McConnell added.
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