ABOARD AIR FORCE ONE (Reuters) - President Barack Obama continues to oppose extending Bush-era tax cuts for wealthier Americans, the White House said on Wednesday, shrugging off calls for a temporary extension to allow more time for a deal on deficits.
"President Obama has been clear about his position and it has not changed," White House press secretary Jay Carney told reporters traveling with Obama to California. "We should not extend and he will not extend the ... Bush-era tax cuts for the wealthiest two percent of the American people."
Tepid U.S. job creation in May and a festering European debt crisis have fanned concern about the strength of the U.S. recovery ahead of a so-called 'fiscal cliff' on January 1, which some economists say will reduce economic growth sharply.
Income tax cuts signed into law by former President George W. Bush expire at the end of this year. And in January, deep automatic government spending cuts start kicking in, unless Congress either agrees to a sweeping deal to curb the U.S. deficit before that deadline or passes legislation specifically stopping the scheduled spending cuts.
Analysts and some politicians argue that threat should spur action by lawmakers, but there has been little sign of a willingness for a deal before the November 6 general election, at which Republicans hope to defeat Obama and take over Congress.
Obama has consistently argued that taxes on households making over $250,000 a year should be allowed to rise to the pre-Bush level of 39.6 percent, from 35 percent at the moment.
He says he will not agree to further spending cuts without steps to increase tax revenues, which Republicans oppose.
Former Democratic president Bill Clinton told CNBC on Tuesday that "I don't have any problem with extending all of it now," in reference to a temporary extension of the tax cuts, but he argued making the cuts permanent for the rich would be an error.
His spokesman, Matt McKenna, subsequently said that Clinton did not support extending tax cuts for rich Americans.
Larry Summers, a former U.S. Treasury Secretary under Clinton and former top economic aide to Obama, said on MSNBC on Wednesday that "we've got to make sure we don't take the gasoline out of the economy at the end of this year."
Summers did not say the tax cuts for the richest Americans should be extended, but Republicans, as they pushed to preserve lower tax rates for everyone, seized on his remark as evidence of a split between Obama and the two Democratic heavyweights.
"It's pretty obvious that the economy needs the certainty of the extension of the current tax rates for at least a year," said Mitch McConnell, the top Republican in the U.S. Senate.
"That would also give us the time to begin to grapple with something we all agree we need to do on a bipartisan basis, which is to reform the whole tax code," McConnell said.
(Reporting By Caren Bohan; Writing by Alister Bull; Editing by Paul Simao)