President Obama is sending mixed signals on the fiscal cliff. Here is how I interpreted the President’s statement last Friday (emphasis added today).
I think the most positive thing that can be said about the President’s statement today is that he didn’t say anything that clearly made a deal more difficult. With one important exception, he didn’t budge on substance …
… The one important exception is that today the president did not insist on raising tax rates on the rich, only that they “pay more in taxes.” I assume this was intentional. It allows for at least a portion of the deal like that suggested by the Speaker’s comments: scale back tax preferences for the rich without raising their marginal rates. Of course, that’s only part of what the Speaker said was necessary, but it’s a critical part.
My interpretation was far from unique. Several other observers drew similar conclusions from the President’s apparent constructive ambiguity. It appeared the President was, in reaction to Speaker Boehner, leaving the door open to a deal that raised taxes on the rich but did not raise their tax rates.
But later that same day the President’s press secretary Jay Carney reiterated the President’s prior veto threat:
MR. CARNEY: The President would veto, as he has said and I and others have said for quite some time, any bill that extends the Bush-era tax cuts for the top 2 percent of wage earners in this country, of earners in this country.
I think that means the President would veto a bill unless the top rates go up. He is not requiring that they increase to pre-Bush levels (i.e., not requiring that the top rate increase from 35% to 39.6%), but he is requiring that the 35% number increase, since otherwise the bill would be “extend