News / USA

Obama Hails Senate Procedural Vote on Income Taxes

President Barack Obama on Monday welcomed a key procedural vote in the U.S. Senate on his compromise tax deal with opposition Republicans. Obama spoke to reporters after the measure cleared that first hurdle in the Senate and urged the measure's passage in the House of House of Representatives, where it faces sharp criticism from members of his Democratic Party.

The White House was confident in achieving the votes required to move the measure ahead in the Senate, although the president knows there is more work to do with Democrats in the House who are unhappy with the compromise.

Obama said he has been speaking with House lawmakers about a vote there later this week after the Senate's final vote, which is expected on Tuesday or Wednesday. "I recognize that folks on both sides of the political spectrum are unhappy with certain parts of the package and I understand those concerns. I share some of them. But that is the nature of compromise - sacrificing something that each of us cares about to move forward on what matters to all of us," he said.

At an estimated cost of more than $850 billion, the tax deal would extend for two years current lower tax rates for middle and upper income Americans put in place under former President George W. Bush.  

In return, Republicans agreed to a 13-month extension of benefits for about two million unemployed Americans along with provisions that analysts say amount to a second economic stimulus package.

Taken as a whole, Mr. Obama said, the proposal will grow the economy and create jobs "Nearly every economist agrees that that is what this package will do," he said.

But in the Senate, a Democrat who voted against the tax deal, Colorado's Mark Udall, disagreed. "If tax cuts for the wealthy among us were an efficient way to spur innovation and investment, I have to believe economists would be telling us to continue them. But here is what they're actually saying. Economists of all stripes are telling us that extending cuts for the wealthy is one of the least effective ways to create jobs and build the economy," he said.

Obama has faced intense criticism from liberal House Democrats who accuse him of sacrificing core party principles for a deal with Republicans, who are emboldened by their midterm congressional election victories last month.

After expected final Senate passage, the White House has warned against any significant changes by House Democrats that could cause the compromise to unravel.

A key House Democratic leader, Maryland Representative Chris Van Hollen, calls the Senate bill unacceptable and vows to make changes in at least one area involving taxes on estates.

House Majority Leader Steny Hoyer says Democrats continue to work out their differences, and has not rule out potential amendments to the Senate measure. The core priority, he says, is to ensure that there are no tax increases for Americans.

"In order not to see that happen, we need to get a bill through Congress and signed by the president. We're working on that. The legislative process is a process of give and take.  And I think that is going to occur," he said.

As the president continues working to ensure congressional passage of the tax bill, the White House is playing down a ruling by a federal judge on a key aspect of Mr. Obama's health care reform law.

The ruling by a judge in the state of Virginia found that the provision requiring Americans to purchase health insurance by 2014 unconstitutional, but it did not block the overall health care law from moving forward.

White House Press Secretary Robert Gibbs said the administration disagrees with the ruling, which he noted was expected. He rejected suggestions that it validates a central argument against the health care law. "We're confident that it is constitutional and quite frankly, of the three courts that have rendered decisions on this question, two have ruled in our favor," he said.

Republicans have vowed to try to repeal the health care law, and it faces legal challenge in several U.S. states. Legal analysts expect at least one of these cases to eventually reach the Supreme Court.

Republicans immediately cited the ruling as a victory. Ohio Representative John Boehner, who is expected to become House Speaker in January, reiterated his party's intention to repeal the health care law.

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