Obama calls for end of Bush tax cuts for the rich

President Obama revived the tax issue today, calling for a one-year extension of the George W. Bush-era tax cuts -- but only for the middle class.

In a White House ceremony, Obama said lower tax rates should end for Americans making more than $250,000 a year, citing the government's need to reduce the federal debt and invest in items such as education and infrastructure.

"The money we're spending on these tax cuts for the wealthy is a major driver of our deficit," Obama said, adding that they are also the "least likely to promote growth."

The ceremony featured invited middle-class taxpayers who, Obama said, face higher tax bills of up to $2,200 if all the Bush tax cuts expire at the end of the year, as they are currently scheduled to do.

House Republicans -- saying that ending the Bush tax cuts for the rich will hurt job creators -- plan to vote later this month on a permanent extension; the Democratic-run Senate is not expected to follow suit.

Senate Minority Leader Mitch McConnell, R-Ky., meanwhile, has called for a one-year extension of all the Bush tax cuts while Congress seeks to revamp the entire tax code.

This morning, McConnell said that "today's proposal is clearly based on a political calculus, not an economic one" -- namely Obama's re-election campaign against GOP opponent Mitt Romney.

"In the Obama economy, we need policies that are designed to create jobs," McConnell said. "Not designed to protect his."

House Speaker John Boehner, R-Ohio, mocked Obama's "quixotic call for the same small businesses tax hikes that have been routinely rejected by the House and Senate. How will these small business tax hikes create jobs?"

At the White House, Obama disputed the notion that ending the Bush tax cuts for the wealthiest would hurt small business, noting he has signed a string of tax breaks on their behalf. "The proposal I make today would extend these tax cuts for 97 percent of all small business owners in America," Obama said.

The two parties agreed back in 2010 to a two-year extension of all the Bush-era cuts.

In the months since, Obama has accused the Republicans of seeking to protect their wealthy backers with a permanent extension of the Bush tax cuts; Republicans say Obama wants tax hikes on the very people he wants to create jobs.

Obama's latest call for ending Bush tax cuts for the wealthy comes as his campaign criticizes Republican opponent Mitt Romney for his use of offshore bank accounts; campaign aides have called for Romney to release more of his tax returns.

The revived tax cut proposal also comes less than a week after the latest labor report showed only 80,000 new jobs in June, with an unemployment rate staying at 8.2%.

The president plans to take the tax cut message to campaign trail later this week, with appearances in the closely contested states of Iowa and Virginia.

He also talked up the issue during a string of interviews Monday afternoon with television stations located in battleground states, including Florida, North Carolina, New Hampshire, Iowa, Nevada, and Wisconsin.

The fate of the Bush tax cuts is not expected to be decided until after the Nov. 6 election, during a December lame-duck session.

In his White House remarks, Obama said the parties should go ahead and pass a middle-class extension since they agree on it -- though that would cost Republican negotiating leverage over the rest of the Bush tax cuts.

It should be noted that even wealthy Americans would continue to get the Bush tax rates on their first $250,000 of income, under the president's proposal.

"I'm not proposing anything radical here," Obama said. "I just believe that anybody making over $250,000 a year should go back to the income tax rates we were paying under Bill Clinton."