Raise taxes on wealthiest, Obama challenges GOP

(AP) - In a blunt challenge to Republicans inCongress, President Barack Obama insisted Wednesday thateliminating selected tax breaks for oil companies and thesuper-wealthy must be

WASHINGTON - (AP) - In a blunt challenge to Republicans inCongress, President Barack Obama insisted Wednesday thateliminating selected tax breaks for oil companies and thesuper-wealthy must be part of any deficit reduction plan.

"That's not radical," he said at a White House newsconference. He was quick to add that a bipartisan agreement ispossible to cut deficits, raise the government's debt limit andavert a threatened financial crisis.

Republicans in Congress have been insistent in recent days thatany deficit reduction be limited to spending cuts, includingreductions in benefit programs such as Medicare and Medicaid, andexclude additional revenues.

But Obama said both parties must be prepared to "take on theirsacred cows" as part of the deficit-reduction negotiations.

In his opening remarks, the president called on lawmakers torenew a payroll tax cut that took effect on Jan. 1, identifying itas one of several measures lawmakers could approve to help createjobs. He also urged passage of trade agreements with Panama, SouthKorea and Colombia, and an overhaul of the nation's patent laws.

Obama's last previous full-fledged news conference was in March.In the intervening months, the economic recovery has slowed, thepresident has announced a plan to begin withdrawing U.S. combattroops from Afghanistan and the administration has joined aninternational military coalition working to prevent the rout ofrebels hoping to topple Libyan leader Moammar Gadhafi.

Above all loom the negotiations with Congress on deficit cutsdemanded by Republicans as the price for supporting an increase inthe nation's debt limit.

The president stepped to the podium not long after theInternational Monetary Fund publicly urged lawmakers to raise thedebt limit, now $14.3 trillion, and warned that failure to do socould produce a spike in interest rates and "severe shock to theeconomy and world financial markets."

It recommended a long-term strategy for reducing red ink,warning that cutting deficits too quickly could slow the weakrecovery of the U.S. economy.

The budget deficit is projected to reach a record $1.4 trillionfor the current fiscal year, which ends Sept. 30.

On Libya, the president defended American participation in theNATO military action, saying the U.S. had carried out a "narrowmission in an exemplary fashion" against a tyrant who wasthreating to "massacre his people."

"We have not seen a single U.S. casualty," he said. "There'sno risk of additional escalation. This operation is limited in timeand in scope."

Under pressure to call for gay marriages, the president said hehas done more than all 43 of his presidential predecessors toadvance the cause of rights for homosexual Americans.

He pointed to eliminating the ban on openly gay men and womenserving in the military, a policy known as "don't ask, don'ttell," as well as ordering the Justice Department not to defend alaw that defines marriage as between a man and woman.

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