President Obama called on lawmakers Friday to immediately freeze income tax rates for most Americans while allowing taxes on the wealthy to increase, in his opening bid in the high-stakes struggle with Republicans over the nation's ballooning debt.
Offering his first public remarks since returning to Washington after his election victory, Obama called senior lawmakers of both parties to the White House next Friday to discuss how to avoid the year-end "fiscal cliff," the automatic series of tax hikes and spending cuts that economists warn could plunge the nation into recession.
His invitation is the latest in a series of conciliatory moves by leaders of both parties in the immediate aftermath of the election.
"I'm not wedded to every detail of my plan. I'm open to compromise," Obama told an audience in the East Room of the White House. "But I refuse to accept any approach that isn't balanced. I am not going to ask students and seniors and middle-class families to pay down the entire deficit while people like me, making over $250,000, aren't asked to pay a dime more in taxes."
While demanding that the wealthy pay more in taxes, Obama did not specifically insist that their income tax rates must rise. The administration has traditionally said that the George W. Bush tax cuts for the wealthy must expire as scheduled at year's end, raising rates for upper-income earners to 39.6 percent. Republicans strongly oppose that position and have said it cannot be part of any deal to avert the fiscal cliff.
It was not clear whether Obama had intended to signal new flexibility over how to tax the wealthy.
But close observers, including top Republicans, quickly said there were potential grounds for compromise if the White House was willing to seek increased revenue from the wealthy without raising rates - for example by cutting deductions and loopholes that disproportionately benefit the wealthy.