President Obama is not backing down from his campaign promise of raising taxes on the wealthy to help reduce the deficit. White House press secretary Jay Carney told reporters Tuesday that the president wants to raise $1.6 trillion in tax revenues on corporations and the wealthy over the next decade, twice the amount that Republican House Speaker John Boehner and Obama put on the table during secret debt-ceiling negotiations in 2011, the Washington Post’s Zachary Goldfarb and Lori Montgomery report.
Even revenue generated by allowing the Bush-era tax cuts to expire on the nation’s wealthiest 2 percent wouldn’t be enough to tame the $16 trillion national debt, according to Carney. Republicans have adamantly opposed raising tax rates but say they are open to finding ways to raise overall revenues. They have proposed placing a cap on tax deductions or loopholes that households earning more than $250,000 a year can claim in return for extending the Bush-era tax rates across the board. Treasury Secretary Timothy J. Geithner and other senior Democrats on Tuesday said Obama would not agree to that arrangement. - Read more at The Washington Post
OIL SUPPLIES UP, DEMAND DOWN Even though oil prices rose modestly on Wednesday, analysts at the International Energy Agency say the cliff, combined with the debt crisis in Greece, the devastation caused by Hurricane Sandy and the weak European economy have combined to bring down oil prices. That pressure is likely to continue as fears of slowing demand forced the IEA to lower its forecast for fourth-quarter oil by 300,000 barrels per day to 90.1 million barrels. Meanwhile, global oil supplies increased 800,000 barrels per day to 90.9 million barrels per day in October, the agency said. - Read more at CBSNews
TECH LEADERS SOUND OFF ON FISCAL CLIFF The chief executives of some of the nation’s largest technology companies this week joined hundreds of other business leaders in the effort to push for a Washington solution to the fiscal cliff.
The Technology CEO Council joined the growing chorus of business representatives on Tuesday, urging Congress and the Obama administration to reach a compromise on deficit reduction before the end of the year and to cancel the massive tax hikes and spending cuts set to automatically kick in Jan. 2.
Dell’s Michael Dell, Qualcomm’s Paul Jacobs, Intel’s Paul Otellini, and IBM’s Ginni Rometty, among others, said that allowing the tax hikes and spending cuts to take effect will “undermine our economy and make the challenge of restoring growth and fiscal sustainability that much more difficult.” The CEOs called for strategic government spending cuts, as opposed to the automatic across-the-board budget slashing scheduled to take effect. They also called for corporate tax reform that includes lower rates, broadening the base and a territorial system that allows companies to bring back foreign earnings without paying U.S. taxes. - Read more at the Los Angeles Times
O, YE OF LITTLE FAITH Americans have little faith that President Obama and Congress will set aside their differences and compromise on deficit reduction before the end of the year, according to a new Washington Post-Pew Research Center poll.
The survey shows that 51 percent of respondents believe that Washington will fail to cut a deal, potentially sending the economy into recession. If a deal isn’t reached and a fiscal crisis ensues, 53 percent said they will blame congressional Republicans, while 29 percent said they’ll blame President Obama.
Read more at The Washington Post
FABER: PREPARE FOR MELTDOWN Economic uncertainty surrounding the outcome of negotiations has been blamed for the market’s poor performance for the past week, but Marc Faber, author of the Gloom, Boom and Doom report, disagrees. He told CNBC on Tuesday that he doesn’t believe the markets are going down because of cliff fear. “The market is going down because corporate profits will begin to disappoint, the global economy will hardly grow next year, or even contract,” Faber said, adding that he predicts stocks will drop “at least 20 percent.” - Read more at CNBC
IRS HEAD SAYS ‘BREAK THE CODE’ If the guy running the store doesn’t know what he’s selling because there’s no way to take inventory, then the store will go out of business. That’s essentially what Douglas Shulman, departing commissioner of the Internal Revenue Service, just admitted to Congress and the Obama administration as they prepare for what is sure to be a long, drawn-out battle over tax reform.
Shulman agrees with many lawmakers and policy experts that the federal messy, convoluted tax code is ripe for overhaul. “There is “broad bipartisan consensus that the tax code is too complex” and that “it would serve the American people better to have a tax code that has more certainty without as many expiring provisions,” he told The Wall Street Journal. - Read more at The Wall Street Journal
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