Top Obama officials defend tax hikes in budget

The American flag flies at the U.S. Capitol, Sunday, Feb. 8, 2009, in Washington. One of President Barack Obama's top economic advisers forecast Sunday a difficult struggle with Congress over Senate cuts of $40 billion for state and local governments from the administration's massive spending and tax cut package to stimulate the failing economy. - photo by Associated Press

Obama Stimulus Econom Heal — The American flag flies at the U.S. Capitol, Sunday, Feb. 8, 2009, in Washington. One of President Barack Obama's top economic advisers forecast Sunday a difficult struggle with Congress over Senate cuts of $40 billion for state and local governments from the administration's massive spending and tax cut package to stimulate the failing economy. - photo by Associated Press

WASHINGTON — President Barack Obama's top economic officials on Tuesday vigorously defended tax hikes in the administration's $3.6 trillion budget against Republican claims that they would affect nearly all Americans.

Treasury Secretary Timothy Geithner and White House Budget Director Peter Orszag, in separate appearances on Capitol Hill, stuck to the administration line that the president's budget would benefit 95 percent of working Americans.

Higher taxes for affluent Americans would not come until 2011 once "we are safely into recovery," Geithner told the tax-writing House Ways and Means Committee.

"I'm confident this is the right path for the country," Geithner said.

But Republicans argued that the portion of the budget that would require polluters to purchase permits from the government for their emissions would essentially impose huge new energy costs on consumers and businesses.

"The president's budget increases taxes on every American, and does so during a recession," Rep. Dave Camp, R-Mich., told Geithner.

Camp also complained about provisions that would limit the size of charitable contributions that could be taken by families earning more than $250,000 a year.

But Geithner defended the proposals, saying far more people would benefit from lower taxes under the plan.

Orszag faced similar questioning before the House Budget Committee.

He defended Obama's proposal to raise taxes on more affluent Americans.

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