Obama Pushes Payroll Tax Cut In N.H.

President Obama campaigned in New Hampshire Tuesday, stressing the dire consequences if Congress fails to extend the payroll tax cut. On the same day, former Massachusetts Gov. Mitt Romney purchased air time in the state for his first TV ad of the campaign: an attack on Obama's management of the economy. Robert Siegel talks with NPR White House correspondent Scott Horsley.

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ROBERT SIEGEL, HOST:

From NPR News, this is ALL THINGS CONSIDERED. I'm Robert Siegel.

The New Hampshire primary is seven weeks away. But today, people in New Hampshire are getting an early taste of what the general election campaign might look like. President Obama traveled there to pitch a piece of his jobs plan, and the president's visit was met with full-page newspaper ads and a brand-new TV ad from Republican Mitt Romney.

NPR's Scott Horsley joins us now from Manchester, New Hampshire. And, Scott, the president's visit was ostensibly not about his re-election bid. He's supposed to be there to pitch his jobs program, isn't he?

SCOTT HORSLEY, BYLINE: That's right, Robert. In particular, one piece of his jobs plan that would extend the payroll tax cut. You remember this was a cut that was put in place during the lame duck session last year. And it saves the typical family making some $50,000 a year about $1,000 a year, but it's due to expire at the end of this year. So Mr. Obama wants lawmakers to extend the cut or, better yet, increase it so the typical family would save $1,500. He's basically throwing down a challenge to congressional Republicans who fought so hard to preserve Bush-era tax cuts for the wealthiest Americans.

PRESIDENT BARACK OBAMA: You know, when push comes to shove, are you willing to fight as hard for working families as you are for the wealthiest Americans? What's that - what's it's going to be? That's the choice.

HORSLEY: And what we found, Robert, is that any tax cut, even one that's supposed to be temporary, is pretty hard to undo once it's in place.

SIEGEL: Now, Republicans in Congress have been cool to the president's jobs plan up until now. What are the prospects with the payroll tax cut?

HORSLEY: Well, this is one piece of the plan that's probably more politically palatable than most, certainly more acceptable than, say, giving money to states to keep public employees on the payroll. But the rub as always is how do you pay for it? It costs something like $100 billion to extend the tax cut, let alone enlarge it. And so do you make up for that with higher taxes on the wealthy? That's a challenge. If you don't pass it, though, if you don't extend the tax cut, economists say it would be a real drag on an already weak U.S. economy. So I think the betting is we'll see at least an extension of the existing tax cut. Enlarging it, extending it to employers, that's going to be a tougher sell.

SIEGEL: Now, President Obama won New Hampshire in 2008. But I gather, early polls suggest that he's in for a very tough contest there in 2012.

HORSLEY: Yes. Somewhat surprisingly since unemployment rate here in New Hampshire is just 5.5 percent. I mean, a lot of states would kill for that. It's way below the national average. But this is home turf for Mitt Romney, the former governor of neighboring Massachusetts. And one of Romney's homes is here in the Granite State, so he's sort of a hometown hero. And he has strong lead in the primary field. And according to a recent Bloomberg poll, he's leading Mr. Obama in a hypothetical head-to-head match-up by 10 percentage points.

SIEGEL: Now, Mitt Romney used the occasion of the president's visit to launch his first TV ad of the campaign. Tell us about that.

HORSLEY: Yes, and also a full-page newspaper ads in which he says that the president's economic policies have been a failure. In that first TV ad he tries to use Mr. Obama's own words against him.

(SOUNDBITE OF AD)

OBAMA: If we keep talking about the economy, we're going to lose.

HORSLEY: Now, we should say that this quote from President Obama is taken completely out of context, something that the Romney campaign has acknowledged. Mr. Obama is actually quoting someone from John McCain's campaign in 2008. And back then, the McCain folks really didn't like talking about the economy. But not only is this a distortion of what Mr. Obama said, it really doesn't apply because the president is not shying away from talking about the economy.

His message is while it's not good enough, my policies are the right ones to make it better. So if indeed this is the match-up we get in 2012, I think both candidates are going to spend a lot of time talking about the economy, and voters will really get a choice of whose policies they prefer.

SIEGEL: OK. That's NPR White House correspondent Scott Horsley in New Hampshire. Thank you, Scott.

HORSLEY: My pleasure.

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