To get the economy back on track, will President Barack Obama have to break his pledge not to raise taxes on 95 percent of Americans? In a “This Week” exclusive, Treasury Secretary Tim Geithner told me, "We’re going to have to do what’s necessary.”
Geithner was clear that he believes a key component of economic recovery is deficit reduction. When I gave him several opportunities to rule out a middle class tax hike, he wouldn’t do it.
“We have to bring these deficits down very dramatically,” Geithner told me. “And that’s going to require some very hard choices.”
“We will not get this economy back on track, recovery will be not strong and sustained, unless we convince the American people that we are going to have the will to bring these deficits down once recovery is firmly established,” he said.
While Geithner told me, “There are signs the recession is easing,” he warned that, “We have a ways to go.”
“I want to emphasize the basic reality that unemployment is very high in this country,” the secretary said. But, he underlined that the administration is “going to do what is necessary to bring growth back on track.”
Turning to the bank bailout, he told me it is “quite unlikely” that the U.S. Treasury will go back to Congress to ask for more funding for the financial rescue package.
"We do not plan to ask for more money and I think it’s quite unlikely that we do," Geithner said in his most blunt language to date on TARP funding. The secretary said that today the TARP has roughly $130 billion, in part due to more than $70 billion that has already come back into the government.
But wait a minute. Barry Obama said on the campaign trail that he would not raise ANY of my taxes if I made less than 450,000. Then it was 250,000. See, I have proof:
Whichever it is, Barry has some 'splaining to do.
UPDATE: In a presser today, White House Press Secretary Gibbs threw Geithner under the bus:
Pressed repeatedly on the issue, presidential spokesman Robert Gibbs said repeatedly that Obama stands behind his iron-clad campaign pledge that any tax hikes would only hit individuals making more than $200,000 a year and families earning more than $250,000.
"The president has been clear on his commitment on this," Gibbs told reporters.
"The door's not open even a millimeter on raising taxes?" a reporter asked.
"I hope you'll take seriously what I said," Gibbs replied.
Gibbs had to answer because Advisor Lawrence Summers had also raised the spectre of higher taxes....
However, some people are not going quietly into the good night and are demanding action and clarification:
Before, or despite, the comments from Gibbs, Americans for Tax Reform said the appearances by Geithner and Summers are the "latest of a string of statements by Obama’s spokesmen and appointees gradually stepping back from the 'firm pledge' made during the campaign."
“Obama should fire Geithner and Summers,” Grover Norquist, the group's president, said in a statement. “Two appointees of President Obama went on national television and implied the president lied his way into office and that he is open to raising taxes.”
“To have the president’s own appointees accuse him of lying his way into office is a betrayal beyond words,” Norquist added. “If, however, Obama has been silent in reaction to these two statements, he does intend to raise taxes, and he should resign because he lied his way into office by making a promise he had no intention of keeping.”