New reality: Obama, GOP talk compromise, conflict

By David Espo

Associated Press

Published: Wednesday, Nov. 3 2010 7:44 p.m. MDT

House Republican leader John Boehner of Ohio takes questions on the GOP victory in the 2010 midterm elections.

Associated Press

Enlarge photo»

WASHINGTON — A chastened President Barack Obama signaled a new willingness to yield to Republican demands on tax cuts and jettisoned a key energy priority on Wednesday, less than 24 hours after he and fellow Democrats absorbed election losses so severe he called them a shellacking.

But he bluntly swept aside any talk of repeal of his signature health care law — right after the House Speaker-in-waiting, Rep. John Boehner of Ohio, vowed Republicans would do everything they could to wipe the legislation off the books.

Boehner, a 60-year-old veteran of two decades in Congress, spoke at what amounted to his national debut as head of an incoming conservative majority that will include long-experienced lawmakers and tea party-backed political newcomers alike. He declared, "Our new majority will be the voice of the American people as they expressed it so clearly yesterday."

Separately, the Federal Reserve announced new steps designed to further lower interest rates on loans and lead to more job creation, using powers denied mere politicians.

Taken together, the fast-paced series of events confirmed the primacy of the economy as an issue in a country with 9.6 percent unemployment, record home foreclosures and disappointingly slow growth.

In purely political terms, they also underscored a dramatic overnight power realignment after two years of grinding partisanship in Congress followed by a coarse and costly campaign.

For all the uncertainty they loosed, there was little that was ambiguous about the election results. House Republicans picked up 60 seats to capture a majority and led for five more, ending a four-year span in which Nancy Pelosi served as the first female speaker in history.

The GOP picked up at least six seats in the Senate in races reflecting both the peril and the potential of a tea party movement that emerged during the campaign.

Speaking to reporters in the Capitol, Boehner said he and fellow Republicans hope the president "will continue to be willing to work with us" on the priorities of creating jobs and cutting spending.

But, he added, "We're going to continue to renew our efforts for a smaller, less costly and more accountable government here in Washington, D.C."

Obama struck similar themes at his own news conference a few hours later, saying he was eager to sit down with the leaders of both political parties "and figure out how we can move forward together." He added, "It won't be easy," noting the parties differ profoundly in key areas.

Sounding more conciliatory than in the past, the president said he was open to compromise with Republicans on their demand for an extension of all of the Bush-era tax cuts due to expire on Jan. 1, including those that apply to upper-income earners.

"My goal is to make sure we don't have a huge spike in taxes for middle-class families," he said. He omitted mention of his campaign-long insistence that tax cuts be permitted to expire on upper-income families. The issue produced pre-election skirmishes in Congress and frequent disagreement during the campaign.

Obama also virtually abandoned legislation, hopelessly stalled in the Senate, that includes economic incentives to reduce carbon emissions from power plants, vehicles and other sources.

"I'm going to be looking for other means of addressing this problem," he said. "Cap and trade was just one way of skinning the cat."

Republicans have long slammed the bill as a "national energy tax" and jobs killer, and numerous Democrats sought to emphasize their opposition to the measure during their own re-election races.

Boehner, too, was asked about the expiring tax cuts, and he replied simply that he continues to believe they should all be extended.

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