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Happy New Year, everybody.
Happy New Year, Mr. President.
A central promise of my campaign for President was to change the tax code that was too skewed
towards the wealthy at the expense of working middle-class Americans. Tonight we've done
that. Thanks to the votes of Democrats and Republicans in Congress, I will sign a law
that raises taxes on the wealthiest 2 percent of Americans while preventing a middle-class
tax hike that could have sent the economy back into recession and obviously had a severe
impact on families all across America.
I want to thank all the leaders of the House and Senate. In particular, I want
to thank the work that was done by my extraordinary Vice President Joe Biden, as well as Leader
Harry Reid, Speaker Boehner, Nancy Pelosi, and Mitch McConnell. Everybody worked very
*** this and I appreciate it. And, Joe, once again, I want to thank you for your great
work.
Under this law, more than 98 percent of Americans and 97 percent of small businesses
will not see their income taxes go up. Millions of families will continue to receive tax credits
to help raise their kids and send them to college. Companies will continue to receive
tax credits for the research that they do, the investments they make, and the clean energy
jobs that they create. And 2 million Americans who are out of work but out there looking,
pounding the pavement every day, are going to continue to receive unemployment benefits
as long as they’re actively looking for a job.
But I think we all recognize this
law is just one step in the broader effort to strengthen our economy and broaden opportunity
for everybody. The fact is the deficit is still too high, and we're still investing
too little in the things that we need for the economy to grow as fast as it should.
And that's why Speaker Boehner and
I originally tried to negotiate a larger agreement that would put this country on a path to paying
down its debt while also putting Americans back to work rebuilding our roads and bridges,
and providing investments in areas like education and job training. Unfortunately, there just
wasn’t enough support or time for that kind of large agreement in a lame duck session
of Congress. And that failure comes with a cost, as the messy nature of the process
over the past several weeks has made business more uncertain and consumers less confident.
But we are continuing to chip away at this
problem, step by step. Last year I signed into law $1.7 trillion in deficit reduction.
Tonight’s agreement further reduces the deficit by raising $620 billion in revenue
from the wealthiest households in America. And there will be more deficit reduction as
Congress decides what to do about the automatic spending cuts that we have now delayed for
two months.
I want to make this point: As I've demonstrated throughout the past several weeks,
I am very open to compromise. I agree with Democrats and Republicans that the aging population
and the rising cost of health care makes Medicare the biggest contributor to our deficit.
I believe we've got to find ways to reform that program without hurting seniors who count
on it to survive. And I believe that there’s further unnecessary spending in government
that we can eliminate.
But we can't simply cut our way to prosperity. Cutting spending has to go hand-in-hand
with further reforms to our tax code so that the wealthiest corporations and individuals
can't take advantage of loopholes and deductions that aren't available to most Americans.
And we can't keep cutting things like basic research and new technology and still expect
to succeed in a 21st century economy. So we're going to have to continue to move forward
in deficit reduction, but we have to do it in a balanced way, making sure that we are
growing even as we get a handle on our spending.
Now, one last point I want to make -- while I will negotiate over many things,
I will not have another debate with this Congress over whether or not they should pay the bills
that they’ve already racked up through the laws that they passed. Let me repeat:
We can't not pay bills that we've already incurred. If Congress refuses to give the
United States government the ability to pay these bills on time, the consequences for
the entire global economy would be catastrophic -- far worse than the impact of a fiscal cliff.
People will remember, back in 2011,
the last time this course of action was threatened, our entire recovery was put at risk. Consumer
confidence plunged. Business investment plunged. Growth dropped. We can't go down
that path again.
And today’s agreement enshrines, I think, a principle into law that will remain
in place as long as I am President: The deficit needs to be reduced in a way that's
balanced. Everyone pays their fair share. Everyone does their part. That's how our
economy works best. That's how we grow.
The sum total of all the budget agreements we've reached so far proves that there is
a path forward, that it is possible if we focus not on our politics but on what’s
right for the country. And the one thing that I think, hopefully, in the New Year we'll
focus on is seeing if we can put a package like this together with a little bit less
drama, a little less brinksmanship, not scare the heck out of folks quite as much.
We can come together as Democrats
and Republicans to cut spending and raise revenue in a way that reduces our deficit,
protects our middle class, provides ladders into the middle class for everybody who’s
willing to work hard. We can find a way to afford the investments that we need to
grow and compete. We can settle this debate, or at the very least, not allow it to be so
all-consuming all the time that it stops us from meeting a host of other challenges that
we face -- creating jobs, boosting incomes, fixing our infrastructure, fixing our immigration
system, protecting our planet from the harmful effects of climate change, boosting domestic
energy production, protecting our kids from the horrors of gun violence.
It’s not just possible to do these
things; it’s an obligation to ourselves and to future generations. And I look forward
to working with every single member of Congress to meet this obligation in the New Year.
And I hope that everybody now gets at least
a day off, I guess, or a few days off, so that people can refresh themselves, because
we're going to have a lot of work to do in 2013.
Thanks, everybody. Happy New Year.