Clinton stumps for Obama, then bucks him on tax policy

Undercutting one of President Obama's core economic arguments less than 24 hours after campaigning for him, former President Bill Clinton said Tuesday that Congress should extend the George W. Bush-era tax cuts, even for the wealthy, because the economy threatens to tumble back into recession.

Mr. Clinton said a temporary extension of tax cuts for all income brackets would be the best way to kick-start the economy.

"That's probably the best thing to do right now," Mr. Clinton said in an interview with CNBC. "But the Republicans don't want to do that unless [Mr. Obama] agrees to extend the tax cuts permanently, including for upper-income people. And I don't think the president should do that."

The interview instantly provided Republicans with campaign ammunition on two subjects that are forbidden territory in the Obama White House: talk of a "double-dip" recession and supporting tax cuts for the wealthiest Americans, whom Mr. Obama constantly contends aren't paying their "fair share."

"The fact that former President Clinton supports stopping all of the tax hikes scheduled for January 1 is very, very big news," said Michael Steel, spokesman for GOP House Speaker John A. Boehner.

Mr. Steel added, "Will President Obama get off the campaign trail and lead on this issue, now that his predecessor has weighed in? Inquiring minds want to know."

Mr. Clinton's off-message comments underscored what a double-edged sword he is for Mr. Obama's re-election. Monday night, Mr. Clinton appeared at three fundraisers in New York City that brought in more than $3 million for the president and other Democratic campaigns. He told supporters that Mr. Obama's re-election is a necessity.

But last week, Mr. Clinton also credited GOP presidential nominee Mitt Romney with having a "sterling" record in the private-equity business. The Obama campaign has been portraying Mr. Romney as someone who was interested only in profits for investors, not creating jobs.

Even as Mr. Clinton urged Democrats to support Mr. Obama Monday night, he reminded the audiences that he, not Mr. Obama, was the last president to oversee federal budget surpluses. White House press secretary Jay Carney was asked Tuesday if that reminder had been "awkward" for Mr. Obama, who shared the stage with the 42nd president.

"That is a profoundly interesting question," Mr. Carney said to laughter from the press corps. He said Mr. Clinton was making the point that he inherited deficits and "turned over to his successor" budget surpluses that should have lasted indefinitely.

"Eight years later, when President Obama took office, handed the Oval Office by his predecessor, a Republican president, we had the largest deficits in history up to that time," Mr. Carney said. "Now, something happened in those eight years, and it was not fiscal responsibility. And that is unfortunate. We had a situation in eight years where record surpluses were turned into record deficits."

• Susan Crabtree contributed to this report.

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