December 6th, 2010
07:07 PM ET

Obama announces proposed deal on taxes, jobless benefits

[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2010/images/12/06/obama.jpg]

Ed Henry
CNN Senior White House Correspondent

President Barack Obama on Monday announced a deal with Republican leaders that would extend Bush-era tax cuts for two years and unemployment benefits for 13 months while also lowering the payroll tax by two percentage points for a year.

The compromise, worked out in negotiations involving the White House, the Treasury and congressional leaders from both parties, includes provisions that each side doesn't like, Obama said in a hastily arranged statement to reporters after discussing the proposed deal with Democratic leaders.

"It's not perfect," Obama said of the plan, which also would continue tax breaks for students and families contained in the 2009 stimulus bill and allow businesses to write off all investments they make next year. "We cannot play politics at a time when the American people are looking for us to solve problems."

As outlined by Obama and sources, the deal would add trillions of dollars to federal spending in coming years by extending the lower tax rates as well as the jobless benefits at a time when the president, Republican leaders and a federal deficit commission appointed by the president all say that the growing federal debt must be brought under control.

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Filed under: 360° Radar • Ed Henry • President Barack Obama • Raw Politics
soundoff (77 Responses)
  1. Dan Crofoot

    I guess we have to give the rich they 20 pecies of silver to save the poor. What the underground thinks of it could be a bloody mess.people who have nothin to loss is what we need to worry about not whats going on overseas.How can we help others around the world when we cant help ourselfs. And do we what them like us I hope not. God helps us if this dnt work.

    December 7, 2010 at 10:29 am |
  2. Bobby Brown

    Uhhh– I know everyone is busy, but isn't someone going to say something about the Pearl Harbor Attack today? A day that will "live in infamy" but apparently forgotten by the media and Washington!

    December 7, 2010 at 9:21 am |
  3. Pam

    How can the Republicans insist that tax cuts for the wealthy creates jobs, when the country has experienced a growth in unemployment during the Bush tax cuts. The census data proves what I see on the frontlines as a CPA-the wealthy don't spend or create jobs, but rather their wealth has increased. Jobs are created from a need-not from tax cuts.

    December 7, 2010 at 8:58 am |
  4. Bernice

    Unbelievable! This is not about Bush but about a Congress that has sold out on the American people. It is about money. Was anybody watching the last six months? Wake up people this ride is going to get bumpy. But do not give up on the President.

    December 7, 2010 at 5:44 am |
  5. Richard Wolff

    Funding another round of unemployment benefits, although necessary, adds to the deficit. Giving tax cuts to the rich, which is unnecessary to help the economy, also adds to the deficit. We need additional tax dollars to dig out of the deficit.

    How about raising the taxable income limit to $400,000? While that exempts the President, it also says that anyone who makes more money than the President of the United States of America should pay a bigger share in taxes.

    December 7, 2010 at 2:22 am |
  6. Ken

    The extension of unemployment benefits can be funded by a tax on all political donations.

    December 7, 2010 at 1:49 am |
  7. Jamie, CA

    Why is it that no one is talking about the LONG term unemployed? There are many Americans who have been without a job for years and who have exhausted ALL of their unemployment benefits. There is an estimated almost 5 million people according to the department of labor who have exhausted their UI benefits. These people are now known as the 99er's. The deal being worked on now in congress doesn't even mention this large group of people who are hurting just as bad, if not worse, as the rest of the unemployed. If an unemployment extension is warrented for tiers 3 and 4, then a tier 5 should be just as warrented. I just don't understand how this group of people can be forgotten. All unemployed should be helped, not just some of them. Why isn't this being reported on?

    December 7, 2010 at 1:37 am |
  8. Timothy Tourville

    I think it is ridiculous to extend the tax cuts to the rich. I was just getting ready for bed when I heard on CNN Pres. Obama agreed to extend the tax cuts for 2 more years. Where is his back bone for standing up for the middle class. The rich will never spend the money they receive from the tax cuts thats why the rich get richer snd the poor get poorer. It is all politics as usual.

    December 7, 2010 at 1:25 am |
  9. Sarena Jackson

    For real, what do people expect Obama to do. Fix 8 years of turmoil in 2 years. We as a people have to get more involved in whats going on. Obama can't stand alone. All the people that voted for him, need to stand their ground and srop being wishy washy when things aren't going their way at the moment. Obama has plans to fix the economy and this country. But, as long as other countries and people see we are not united they will continue to try to make us weak. so they are stonger. Stand by our President and trust what he is doing is right.

    December 7, 2010 at 1:25 am |
  10. Rob Freeman

    Hard to believe that ANYONE would ever trust anyone from the GOP. No one from the party ever seems to provide an acceptable response when questioned. They consistently avoid giving straight answers and yet people LISTEN and consider their answers ACCEPTABLE??? Not one response considering the deficit, but tonnes about democratic spending... What a disappointing and gullible bunch we have become.

    December 7, 2010 at 1:25 am |
  11. tcarr

    Extending unemployment benefits = good
    Extending tax breaks for those who make under $250,000 = good
    Extending tax breaks for those who send our jobs to China, and will do anything to make a profit, while destroying middle class America = Very bad

    Congratulations Republicans, you got your tax breaks extended at the cost of America's working man!

    December 7, 2010 at 1:23 am |
  12. dave

    Ok,now let the republicans create the jobs that the tax cut for all the fat cats are going to receive.

    December 7, 2010 at 1:19 am |
  13. dave1

    whats messed up more? taxes for the rich? or the people who are complaining that the unemployed should go get a job (that doesnt exist)! these people that say this, are truly uneducated and have got to have a bald spot where the dunce cap has sat all these years. the same ones that send you out for firewood in the middle of the desert.

    December 7, 2010 at 12:18 am |
  14. Mustafa

    I was thinking to share my ideas with people here in this website,but unfortunately my first and last comment is pending till now. I was silent for almost three years, but now I talk, talk and talk till my people know me.

    December 6, 2010 at 11:57 pm |
  15. Dave B

    First to Roland's questions about the benefits of the Bush 2001 and 2003 tax cuts. They pulled us out of a slumped economy after the terrorist attacks on 9/11 and they kept unemployment at 5 to 7 % under most of the 8 Bush years. Check it out for yourself!

    As to Obama's statement tonight on the Tax Framework. What a guy. The Republicans enter a compromise with him on a 2 year extension of all the Bush Tax cuts and the estate tax. Obama gets 16 months of continued unemployment benefits and a 2% reduction in SS payroll taxes next year, etc. However, instead of giving Republicans credit for working with him on a compromise, he attacks them. What a guy!

    December 6, 2010 at 11:53 pm |
  16. s tornabene

    Isn't it true that the trickle- down effect of supply side economics has never worked. If this is the case, why is the republican party so adamant in keeping tax breaks for the very rich. Are the economists wrong, and if so, can a republican tell me when it did work.

    Thank you

    December 6, 2010 at 11:45 pm |
  17. David

    I don't regret voting for Obama but I am very disappointed with the way he has given in to the Republicans. He sold out to the millionaires.

    December 6, 2010 at 11:39 pm |
  18. Jay

    The tax breaks for the other 98% will cost over $3 trillion over the next decade. Why are you not bad about that? Probably because you are in the 98%?

    December 6, 2010 at 11:36 pm |
  19. Jay

    This is the first thing Obama has done that has been bi-partisan. I do not like his ideology but I support this decision.

    December 6, 2010 at 11:34 pm |
  20. Kay

    The wealthy have had tax breaks for quite a few years....now explain why the jobs have not been produced.

    December 6, 2010 at 11:33 pm |
  21. Rena, Wa.

    I felt hopefull with Obamas election. Now I just feel betrayed!

    December 6, 2010 at 11:32 pm |
  22. bob

    come on Anderson, you know better than any of us what it is like to have unlimited earnings... get specific $1,000,000 (million) @5% annual interest is about $1,000 a week unearned income.
    $10,000,000 savings is $10,000 a week unearned income... $100,000,000 is around $100,000 a week unearned, $1,000,000,000 (billion) is around $1,000,000 a week unearned...everybody knows our super rich American's names but how many people know their cash flow... this low taxed compound interest is why they take 24% GDP

    December 6, 2010 at 11:28 pm |
  23. Kimberly NY2Kansas

    It has been a fascinating thing to listen to.The defense of explainations from Republicans for tax cuts for the rich.Do you really think these business owners are going to immediately hire people if they continue to get the tax breaks?Why do we sem to forget basic math and economics?The law of supply and demand.If you have no demand there is no need to produce a supply that no one will buy or use.You can't make someone hire and they love all the profits... hoarders and happy to do it!

    December 6, 2010 at 11:24 pm |
  24. Greg

    It is amazing how the Republican party just backed the President into a corner to continue some of the same practices that got us into this mess with the debt. The one thing that is really so disturbing is that the Republican Party appears to be all about maintaining their own wealth and not restoring this country back to healthy financial status with their smoke screen tactics. Keep up the good work guys I am quite sure this country will continue to lose its status as one of great power. I imagine countries like Russia, Japan and Korea look upon us and smile because they can count on our own government to prevent any progress. How fitting for a country that pledges United We Stand!

    December 6, 2010 at 11:24 pm |
  25. Vernon

    Doesn't anyone in either party-republican or democrat–realize that the problem here is not tax cuts to decrease the deficit. If you want to decrease the deficit, bring the jobs back to America and put our people to work making a real wage. The truth is that if our people are not working, no one is paying taxes!! I say raise taxes on all of the major cooporations that have taken our jobs overseas and have to import their goods so they will bring the jobs back to America.

    December 6, 2010 at 11:23 pm |
  26. Rudy Luegger

    Washington never changes. More bad deals that do nothing for the country in the long term. A pox on all their houses

    December 6, 2010 at 11:22 pm |
  27. Jonathan Emdin

    I think Bill Maher was right on GPS, Obama should have pushed for the tax cuts families making less than $250,000 annually and settled with republicans on 1 million dollars instead of having an all encompassing tax cut for all, (this makes no sense because with this proposal Obama will burden himself with having to have to health care, education and other still prevalent problems but now with less money. Overall Obama stil has my vote though solely on the basis that there has yet to be another individual showing a comparable level of competency. Obama has a tough time ahead with the republicans in control. The next state of the union address will be pivotal to Obama's success and ability to make head way.

    December 6, 2010 at 11:19 pm |
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