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White House signals openness to tax cut extension

Confusion persists, but after a senior White House aide’s comments to The Huffington Post, it appears that the Obama administration is again signaling its openness to a temporary extension of Bush-era tax cuts for high income Americans.

Senior Obama adviser David Axelrod told the liberal web site in an interview Wednesday that the administration is focused on making sure that families who earn less than $250,000 per year do not see their tax rates rise, a position that could require buy-in from members of Congress who also want to see cuts for the wealthy extended.

“We have to deal with the world as we find it,” Axelrod said. Despite his “concerns” with a temporary extension of the cuts for the wealthy, he said, “I don’t want to trade away security for the middle class in order to make that point.”

Axelrod told National Journal on Thursday that his comments do not mean that the president is conceding in a potential showdown with Congress over the high-income cuts, which Obama has consistently said are too costly.

“We believe that it's imperative to extend the tax cuts for the middle class, and don't believe we can afford a permanent extension of tax cuts for the wealthy,” he said.

One reason for the murkiness: It’s unclear whether or not Democrats have the support to “decouple” the two sets of tax cuts – those for Americans making over $250,000 and those making less – in order to extend the former group temporarily and the latter permanently. The reason, as some of us wrote on Tuesday: Republicans and some Democrats know that permanent tax cuts for the wealthy would never pass by themselves.