Tags: Clinton | Obama | Tax | Cut

Clinton Differs With Obama in Urging Short Tax Cut Extension

Wednesday, 06 June 2012 07:38 AM EDT

Former President Bill Clinton said Congress may have to temporarily extend all expiring tax cuts and spending into early 2013 to give lawmakers time to reach a deal on deficit reduction.

Clinton’s stance contrasts with that of President Barack Obama, who wants to let the breaks for high earners expire as scheduled at the end of 2012.

Matt McKenna, Clinton’s spokesman, later issued a statement that sought to minimize any differences with Obama.

Editor's Note: Obama Donor Banned This Video But You Can Watch it Here

Clinton “does not believe the tax cuts for the wealthiest Americans should be extended again,” McKenna said. The former president “simply said that he doubted that a long-term agreement on spending cuts and revenues would be reached until after the election.”

White House press secretary Jay Carney declined to comment.

Clinton, who appeared with Obama at fundraising events in New York June 4, said in an interview broadcast Tuesday on CNBC that Congress “will probably have to put everything off until early next year” because of Republican demands that the tax cuts for the wealthy be made permanent. Doing so would be “an error,” he said.

“What I think we need to do is to find some way to avoid the fiscal cliff, to avoid doing anything that would contract the economy now and then deal with what’s necessary in the long-term debt reduction plan as soon as they can, which presumably will be after the election,” Clinton said.

Ben S. Bernanke, the Federal Reserve chairman, has warned of a “fiscal cliff” at the end of the year because of tax cuts on wages, capital gains, dividends and estates that are scheduled to lapse. At the same time, automatic spending cuts are scheduled to begin. The Congressional Budget Office has warned that the combined effect may push the economy into recession.

High Earners

Obama, who agreed at the end of 2010 to extend the expiring tax cuts for two years, said in April 2011 that he opposed further extensions of tax cuts for high earners.

“We can’t afford it,” he said. “And I refuse to renew them again.”

Delaying the expiration date of the tax cuts by even a few months would likely require Congress to act first on raising the U.S. debt ceiling. Democrats in Congress such as Representatives Ron Kind of Wisconsin and John Yarmuth of Kentucky have said they have more leverage on the tax issue and would rather address that first.

Senator Orrin Hatch of Utah said in a statement that Obama should “put campaigning aside” and follow Clinton’s advice.

“Bill Clinton and I disagree on many things, but when it comes to stopping this massive tax hike on Jan. 1, we agree,” said Hatch, the top Republican on the Senate Finance Committee. “It’s my sincere hope that President Clinton’s call for action will spur this president to finally lead and prevent the largest tax increase in history, a tax increase that would devastate our already weak economy.”

China View

In a separate interview on the PBS Newshour program, Clinton said Republican presidential candidate Mitt Romney should move cautiously in acting against China on trade if he’s elected. Romney, the former governor of Massachusetts, has vowed to declare China a currency manipulator soon after taking office.

“He’s going to have to think about it, because he’s going to have to look at how much of our debt the Chinese hold and how dependent the world is on seeing their continued success,” Clinton said on PBS. “It wouldn’t necessarily be good for America if there were a total collapse of the Chinese economy. That would cause a lot of trouble.”

China, the world’s second-largest economy, held $1.17 trillion in Treasurys in March, making it the biggest foreign U.S. creditor.

Clinton also sought to explain comments he made in a May 31 CNN interview that undercut an Obama campaign ad that criticizes Romney’s record as a private-equity executive at Bain Capital LLC.

“I didn’t have any idea, when I was giving that answer, that I was wading into some controversy in the campaign, because I haven’t seen the ads,” he said. “But it’s much more relevant to look at what he did as governor and what he proposes to do as president.”

Editor's Note: Obama Donor Banned This Video But You Can Watch it Here

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Wednesday, 06 June 2012 07:38 AM
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