Obama using business CEOs meeting to apply budget pressure

Author: the associated press
The White House / Flickr / MGN

WASHINGTON (AP) – President Barack Obama urged Congress on Wednesday to avoid another contentious budget showdown and warned that the economy would take a hit if the government shuts down again.

Obama blamed Republicans for the shutdown two years ago and made clear he would so again if it comes to that.

“You’ll recall two years ago Republicans shut down the government because they didn’t like Obamacare. Today, some are suggesting the government should be shut down because they don’t like Planned Parenthood,” Obama said. “That’s not good sense, and it’s not good business.”

A partial shutdown will occur Oct. 1 unless lawmakers provide money to keep the federal government functioning. To reach a deal, the GOP-led Congress must take steps including overcoming opposition from some conservatives who want to block federal funding for Planned Parenthood.

Obama used his speech to members of the Business Roundtable to turn up the pressure on lawmakers to reach a budget agreement. He also pointed to a potential revenue source to pay for some of the increased investments he wants in infrastructure, education and scientific research – taxing so-called “carried interest” as ordinary income rather than as a capital gain, which is taxed at a lower rate.

The proposed change is aimed primarily at managers of some types of private investment funds who pay a lower tax rate on their income than do many individuals. He noted, without naming them, that some Republican presidential candidates, primarily Donald Trump and Jeb Bush, have voiced support for increasing taxes on carried interest.

“If we close the tax loophole, we could double the number of workers in America’s job-training programs, we could help another 4 million more students afford college,” Obama said.

This approach “is an example of how we can maintain fiscal responsibility while at the same time making the investments that we need to grow,” he later added.

Taking a sharp jab at his political opponents, Obama described many of his proposals as “no-brainers.” He said the failure to act on them was “primarily because a faction within one of our parties has gone off the rails and sees a conspiracy around everything, or simply is opposed to anything I propose even if they used to propose it. That’s a problem.”

Even as there’s no progress on Capitol Hill toward passage of a stopgap funding bill, top Senate Republican Mitch McConnell of Kentucky again promised Wednesday that there will not be a government shutdown. He dismissed once again a strategy by House tea partiers to try to tie government funding to legislation to take away federal funding of Planned Parenthood.

“We’re not going to engage in exercises in futility,” McConnell said.

He made his comments even as the Senate moved forward with bound-to-fail votes against the Iran nuclear deal and on abortion, and as the House planned legislative attacks on Planned Parenthood destined to go nowhere in the Senate. There was little sign in either chamber that a budget deadline loomed.

Senate Democratic Leader Harry Reid of Nevada said he was heading to the White House on Thursday along with House Minority Leader Nancy Pelosi for talks with the president.

No. 2 House Democrat Steny Hoyer of Maryland said that Democrats would be willing to help advance a temporary government-wide funding bill provided they can strike agreement with Republicans. But Republicans are eying a longer stopgap spending bill than Democrats want. Democrats fear a lengthy stopgap measure would make it more difficult to strike a deal to reverse automatic spending curbs.

Obama also tried to portray an improving economy that has come a long way while he’s been in office. He said it’s doing better than those countries who have embraced spending cuts to climb their way out of tough economic times and that “perennial gloom and doom” descriptions are perpetuated by the presidential campaign that will determine his successor.

“America’s winning right now. America’s great right now. We can do even better,” Obama said.

The Business Roundtable is made up of CEOs from large corporations.

Meanwhile, on Capitol Hill, Democrats ramped up pressure to reauthorize the Export-Import Bank, which helped finance purchases of U.S. exports prior to the expiration of its charter in June after opposition from conservative Republicans.

Hoyer told reporters that he’s hopeful based on a conversation this summer with House Speaker John Boehner, R-Ohio, that Boehner supports renewing the bank. General Electric on Tuesday cited Ex-Im’s expiration as a reason for transferring about 500 jobs to overseas affiliates.

“I think, in my discussions with the Speaker, that he believes that it ought to pass because he believes that it’s costing us jobs,” Hoyer said.

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