Put on the defensive by a Republican budget blueprint, President Barack Obama rejiggered his spending plan Wednesday, calling for $1 trillion in tax increases.
The White House labeled Rep. Paul Ryan's 10-year budget outline a nonstarter because it is not balanced in the first year. Yet Obama's numbers don't balance either -- even with massive tax hikes.
After initially shelving the recommendations of his own deficit commission, the president announced Wednesday that he is serious about closing the nation's $1.4 trillion budget gap.
Chief among his proposals are tax increases on upper-income households.
That's a reversal from December, when the president signed off on an extension of the Bush-era tax rates. At that time, Obama called the lower rates crucial to kickstarting the sluggish U.S. economy.
Now, blaming tax cuts for the nation's rising deficits and debt, Obama declared that fiscal responsibility must be "restored."
"We were on track in 2000 to become debt-free, but lost our way in the decade that followed. We made the problem worse with unpaid-for tax cuts to millionaires and billionaires," Obama said in his address delivered at George Washington University.
Targeting upper-income Americans, the president said, "Those who benefit most, can afford to give back a little more. They continue to do better and better with each passing year."
Obama's gambit puts the administration on a collision course with congressional Republicans and some Democrats who warn that higher taxes will only hinder job creation and slow economic recovery.
Ryan's plan, by contrast, proposes a wide swath of spending reductions that would undercut Obama's budget by $6 trillion over the next decade.
Obama called Ryan's vision "deeply pessimistic" for failing to invest in clean energy, education and transportation while using vouchers to raise the cost of health care.
The president alleged that the GOP plan would give "$1 trillion in new tax breaks" to upper-income households. Ryan has called his approach "revenue neutral" -- raising no taxes, while closing tax loopholes.
Along with the tax hikes -- which he termed "spending reductions in the tax code" -- Obama pledged to pursue further curtailments in defense and health-care spending.
In all, he vowed to cut the deficit by $4 trillion over 12 years and "protect the middle class."
But Obama's attempt to sharpen his own budget position by pushing tax hikes could further complicate upcoming congressional votes on spending. Obama was widely criticized by both the left and right for his aloof approach to talks that nearly resulted in a government shutdown Friday.
"Obama wants to demagogue the rich and demand scrapping the Bush tax cuts. What he is doing is not offering up a real plan -- a plan that can be agreed to on Capitol Hill. Hes offering instead more class warfare," wrote Eric Erickson in the conservative blog, RedState.com.
Reaction from Republicans was fast and furious.
GOP presidential aspirant Mitt Romney called the president "incompetent on the economy."
"He isn't trusted by the private sector," said Romney, a former Massachusetts governor and businessman.
Noting that Obama's speech represented the administration's second attempt at a budget, Tim Pawlenty characterized the president as "a lagging indicator" of what's happening in the country, politically and economically.
"He's has made all kinds of promises and he's broken most of them," added the former Minnesota governor who also is considering a run for president.
U.S. Rep. Michele Bachmann, R-Minn., criticized Obama's insistence on tax increases.
"A tax hike on billionaires wouldn't even get us to August. The top 1 percent [of households] already pay 40 percent of all the taxes," Bachmann said.
Bachmann, who founded the House's Tea Party Caucus, argues that tax increases are counterproductive. "When you raise taxes on job creators, you actually bring in less revenue, rather than more," she says.
Florida's Republicans were equally unimpressed with Obama's performance.
Actions speak louder than words, said U.S. Rep. Tom Rooney. The president who brought us the first $3 trillion deficits in our nations history, and who just recently proposed a budget blueprint that would add nearly $10 trillion to our debt over the next 10 years, is now calling for deficit reduction.
"He is still calling for trillions of dollars in new taxes, still has not offered any specific programs hed be willing to cut, and still has not addressed entitlement reform in a meaningful way.
Adam Hasner, a former Florida state representative eyeing a run for U.S. Senate, said on his Facebook page, "With an election around the corner, it looks like [Obama] is punting to the Bowles-Simpson Commission plan, which is an across-the-board tax hike on the American people."
Also prior to the president's speech, U.S. Rep. David Rivera, R-Miami, issued a statement saying, Our nations economy is fragile and we cannot afford to raise taxes on anyone, especially now. The best way to encourage economic growth is to let people keep more of their own money and to let them decide how to spend it."
Rivera added, "The president's plan raises taxes and would especially punish small businesses.It will also hurt small-business owners who are required to report their business income as part of their personal income, taking their focus away from creating jobs that people desperately need.
Amplifying the GOP criticism, a CNN poll released Wednesday showed only 45 percent of respondents think Obama is "managing government effectively."
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Contact Kenric Ward at kward@sunshinestatenews.com or at (772) 801-5341.
