News Column

At K'Nex plant, Obama Says He Won't Toy Around on Taxes

Dec. 1, 2012

Thomas Fitzgerald and Rita Giordano

obama speech, taxes, fiscal cliff

Dec. 01--In a campaign-style visit to a Montgomery County toy factory Friday, President Obama warned that Republicans in Congress were on the verge of giving millions of Americans a "lump of coal . . . a Scrooge Christmas" by refusing to renew the lower Bush-era tax rates for those making less than $250,000 a year.

The GOP is holding tax cuts for the middle class "hostage" to preserve them for the rich, he argued, adding that as far as he is concerned, any negotiated deal to avoid the fiscal cliff must increase tax rates on the wealthy.

"I've been keeping my own 'naughty and nice' list for Washington," Obama told 350 invited guests and employees at the Rodon Group's Hatfield plant, which makes K'Nex and other popular toys, as he continued his effort to rally the public behind his approach to the budget.

"So you should keep your eye on who gets some K'Nex sets this year," Obama said, drawing laughter.

The first road trip since the Nov. 6 election was part of the White House's stepped-up effort to pressure Republicans, who control the House and have blocking power in the Senate, to bend to the president's will in negotiations over a budget deal. If the sides don't agree on a deficit-reduction plan by Dec. 31, the income tax cuts of 2001 and 2003 will expire, raising taxes on everybody, and automatic budget cuts will begin.

By focusing relentlessly on tax rates for the wealthy, Obama has thrown the GOP on the defensive. But Republicans are pointing out that the president has yet to detail any real spending cuts to round out what he has called his "balanced" approach to deficit reduction.

Arguing that a fragile economic recovery is the wrong environment in which to raise any taxes, they note that allowing the Bush-era cuts for the wealthy to expire would also increase taxes on capital gains and dividends, potentially discouraging investment.

Even as Obama was visiting Hatfield, House Speaker John Boehner was saying in Washington that fiscal talks were at an impasse.

"There's a stalemate. Let's not kid ourselves," Boehner (R., Ohio) said Friday. "I'm not trying to make this more difficult. If you've watched me in the last three weeks, I have been very guarded in what I have to say." But, Boehner added, "right now, we're almost nowhere."

In his talk at the toy factory, Obama said "both sides have to get out of our comfort zones" to make a deal happen, and he reiterated his call for a balanced approach to deficit reduction -- still without discussing any specific cuts.

He urged his listeners to contact their representatives. "I need you to remind members of Congress -- Democrats and Republicans -- to not get bogged down in a bunch of partisan bickering," Obama said, with an array of toys and a giant U.S. flag made of 49,0000 plastic K'Nex pieces as his backdrop. "So I want you to call, I want you to send an e-mail, post on their Facebook wall."

Within the Philadelphia media market are four Republican congressmen whom White House strategists consider potentially persuadable: Pat Meehan, Jim Gerlach, Mike Fitzpatrick, and Charlie Dent. Meehan has said he is willing to support a deal that would increase tax revenue.

Obama, as he has before, said his election victory (with 51 percent of the popular vote) proves the public is with him on the issue of having the rich pay more in taxes. Polls have also shown wide support for spending cuts, however.

One of some two dozen workers who pieced together the flag for the occasion was Cruz Mejias, 54, of Cheltenham, a creative-group manager for K'Nex. Mejias said he voted for Obama and was impressed by the president's speech.

"I just hope the Republicans see the message," he said. "The thing I love is, I think his bipartisan theme is genuine."

Before the speech, Obama toured the plant with chairman and K'Nex coinventor Joel Glickman; the firm's vice chairman and general counsel, Robert Glickman; and chief executive officer Michael Araten. At the last stop, an injection molding machine, Obama became intrigued by the complicated bright-orange K'Nex roller coaster that had been assembled for his inspection. "This is spectacular here," he said.

If workers' reactions were any guide, Obama's message was hitting its mark. At one stop on the plant tour, toolmaker Matthew Weising said he took the opportunity to ask the president about saving American manufacturing jobs, and the president answered him.

"He said, 'I'm working on it,' " Weising, 44, of Souderton, exulted after the event. "I was totally nervous all week, but he was a down-to-earth guy. I would want to sit down in my back yard and have a beer with him."

Though Weising said he had never contacted a congressman before, he might take Obama up on contacting lawmakers and urging them to support preserving the middle-class tax cut.

"I will probably have my family do it, too. It's in our hands now. He's good to go," Weising said of Obama. "Let's get these guys going."

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