Bush Tax Cuts: Obama and GOP Leaders Don't Rule Out Compromise

In an a taped interview with "60 Minutes," broadcast Sunday evening, President Barack Obama spoke with host Steve Kroft about the lessons learned from the 2010 midterm elections, and vowed to work with Republicans to find a compromise on the extension of the Bush tax cuts, set to expire at the end of this year.

Addressing the newly emboldened GOP, led by Sen. Mitch McConnell and Rep. John Boehner, Obama described relations with these top Republicans as "cordial" and that his "assumption is that we're going to be able to work together."

The White House has been vocal in its belief that the Bush tax cuts should only be extended for middle-class earners, and allowed to expire for wealthier Americans on their income over $200,000 per year (or $250,000 year per family). But Republican leaders, including Beohner and McConnell, have pushed for an extension of the cuts across the board.

Asked about how he would work with the GOP to find common ground on the issue, the president said: "We are going to have to have a negotiation. And I am open to finding a way in which they can meet their principles and I can meet mine. But in order to do that, I think we do have to answer the question of how we pay for it."

Kroft followed by asking Obama whether he would take up Boehner's proposal to extend the tax break to the wealthiest for two more years and roll back discretionary government spending to 2008 levels. The president seemed amenable to the idea, saying, "I think that -- when we start getting specific like that -- there's a basis for a conversation."

Republican leaders, appearing on several of the Sunday morning news shows, appeared to stop short of flatly ruling out a compromise on the tax break along those lines, although it was clear they didn't like the idea.

Rep. Eric Cantor, who is likely to be the Republican majority leader when the newly-elected House convenes next year, said on "Fox News Sunday," "I am not for raising taxes in a recession, especially when it comes to job creators that we need so desperately to start creating jobs again."

On CBS' "Face the Nation," Senate Minority Leader Mitch McConnell said: "Look, we can't negotiate it this morning, but our view is, don't raise taxes on small business. We would rather not do it at any time. In fact, I've introduced the only bill that would make the current tax rates permanent. But certainly, you wouldn't want to [raise taxes] in the middle of an income slowdown."

Pressed twice by Fox's Chris Wallace on whether Cantor would settle on nothing less than an extension of all the tax breaks, Cantor said, "At this point, I really want to see that we can come together and agree upon the notion that Washington doesn't need more revenues right now. And to sit here and say, 'Well, we're going to just go about halfway,' or, 'We're going to send a signal that is going to be uncertain for job creators and investors to put capital to work,' that's exactly what we don't need right now. We need to lift the veil of uncertainty."

"I am not for decoupling the rates, because all that says to people looking to go back in and put capital to work and invest to create jobs is, 'You're going to get taxed on any return that you can expect,' " Cantor said.

In an election post-mortem of sorts, Obama addressed missteps made during his first two years in office, and took note of voter dissatisfaction with the stimulus plan and auto industry bailout, saying: "What I didn't effectively drive home is that we were taking these steps not because of some theory that we wanted to expand government. It was because we had an emergency situation and we wanted to make sure the economy didn't go off a cliff -- I think the Republicans were able to paint my governing philosophy as a classic, traditional, big government liberal. And that's not something that the American people want."

Obama also said on Sunday, in a speech to college students in Mumbai, India, that the result of last week's elections "requires me to make some midcourse corrections and adjustments. And how those play themselves out over the next several months will be a matter of me being in discussions with the Republican Party, which is now going to be controlling the House of Representatives. And there are going to be areas where we disagree and hopefully there are going to be some areas where we agree."

In the "60 Minutes" interview, Obama echoed his statements from earlier last week -- when he conceded that the way in which legislation was passed during his first two years was not, in some cases, how he would have preferred it to have been -- by saying: "I think that there are times where we said, Let's just get it done -- instead of worrying about how we're getting it done. And I think that's a problem. I'm paying a political price for that."

On the health care overhaul specifically, the president acknowledged the risks inherent in tackling such a historically complex and controversial topic.

"I think there were some that argued, 'Well, you should just stop and let people digest all these changes. And so, you shouldn't take on something as big as health care.' And -- I'll be honest with you, at the time, we knew that it probably wasn't great politics," he said, adding, "I made the decision to go ahead and do it, and it proved as costly politically as we expected. Probably actually a little more costly than we expected, politically."

When pressed as to why it was riskier than he had initially thought, Obama was blunt, "I couldn't get the kind of cooperation from Republicans that I had hoped for," he said. "We just couldn't."

To the strategists and pundits who have claimed in recent days that the president has a serious communication problem with the American people, Obama tackled the criticism head-on, saying: "I think that's a fair argument. You know, I think that over the course of two years we were so busy and so focused on getting a bunch of stuff done that we stopped paying attention to the fact that leadership isn't just legislation. That it's a matter of persuading people."