Credits: REUTERS/KEVIN LAMARQUE
WASHINGTON, DC -- President Barack Obama is warning Christmas could be ruined next year if the country careens off the so-called fiscal cliff.
While he's not exactly a Grinch, he and the White House are doubling down on their claim that consumer spending -- what the White House council of economic advisors earlier this week called the backbone of the economy -- will fall by 1.7 percentage points next year if Democrats and Republicans don't agree on a major deficit and debt reduction package before the end of December.
And that means buying fewer presents for the holidays.
To hammer the message home, Obama is visiting a toy factory near Philadelphia, PA on Friday to highlight the jobs and businesses at stake.
The Rodon Group factory, which manufactures Tinkertoys and K'NEX building sets, employs about 150 people.
"The President will travel to Montgomery County, Pennsylvania to continue making the public case for action by visiting a business that depends on middle class consumers during the holiday season, and could be impacted if taxes go up on 98% of Americans at the end of the year," according to a White House statement.
Obama was also meeting with small business owners Tuesday at the White House, and middle class Americans Wednesday before hitting the road. But there were no scheduled meetings between Obama and Congressional lawmakers this week, raising concern among Republicans that Obama isn't prepared to play ball at the bargaining table.
"Rather than sitting down with lawmakers of both parties and working out an agreement, he is back on the campaign trail presumably with the same old talking points that we are all quite familiar with," said Republican and Senate Minority Leader Mitch McConnell Tuesday, adding everyone knows Obama is a "very good campaigner.
"What we don't know is whether he has the leadership qualities necessary to lead his party to a bipartisan agreement on big issues like we currently face."
While Democrats and Republicans agree the Bush-era tax cuts should be extended for the middle class, Democrats want the tax rates for wealthy Americans making over $250,000 a year to go up. Republicans, though, are concerned that making the rich pay higher taxes will hamper investments in the economy and that will ultimately mean lost jobs for the working class.
"We don't worry about raising taxes on the rich because we're worried about the rich. We worry about that because of what that's going to do to the poor," said Republican Senator Mike Lee of Utah Tuesday on CNN.
The so-called fiscal cliff, $600 billion worth of tax hikes and spending cuts that automatically come into effect January 1, was purposely put in place by Congress during last year's debt ceiling negotiations as a means of forcing a bipartisan plan to tackle the country's deficit and debt by year's end.