* Drama over debt ceiling hike would hurt economy - official
* President to call for certainty middle class taxes won't
* Obama to renew insistence that taxes rise on wealthy
By Mark Felsenthal
WASHINGTON, Dec 5 President Barack Obama will
renew his case for tax hikes on wealthy Americans to avert a
year-end fiscal crunch and call for a smooth increase in the
nation's borrowing limit in a speech to a business group on
Wednesday, a White House official said.
The president is embarked on an aggressive campaign to
pressure congressional Republicans to compromise on steps to
avoid the so-called fiscal cliff. He will argue to corporate
executives that it would hurt the nation's economy to have
another protracted political fight over raising the debt limit,
the official said.
"The President will highlight why it would hurt our economy
and our nation's businesses if we do not find a solution to
avoid another debt ceiling crisis, and will ask the business
leaders for their help in supporting an approach that resolves
the debt limit without drama or delay," said the official, who
spoke on condition of anonymity.
It was the reluctance of congressional Republicans to agree
to such an increase in 2011 without deep spending cuts that
brought the nation to the brink of default. The result was a
historic lowering of the U.S. credit rating and a setback to the
recovery from a recession that ended in 2009.
The statutory ceiling on U.S. Treasury borrowing is $16.4
trillion. The nation is expected to hit the legal limit near the
year's end, although it can tap emergency measures to stave off
a default and keep the government running into early 2013.
If Congress fails to raise the borrowing cap, analysts
expect the Treasury would run out of options to avoid a default
some time in the latter half of February. That forecast could
change depending on how the administration and Congress deal
with the fiscal cliff at the end of the year.
Obama is due to deliver remarks to the Business Roundtable,
an association representing chief executives of large U.S.
firms, at 10:50 a.m. (1550 GMT).
The president and congressional Republicans are currently
battling over how to avoid automatic tax increases and deep
spending cuts. The president wants to extend expiring tax cuts
for all but the wealthiest Americans while Republican leaders
are dug in against allowing any taxes rises at all.
The president will renew his insistence that taxes rise on
the most affluent Americans in his speech to the business group,
the White House official said.
If the administration and lawmaker remain at loggerheads,
going over the fiscal cliff is projected to throw the weak
economy back into recession.
Obama, re-elected to a second term last month in part on a
pledge to raise taxes on the wealthy, has sought to pressure
Congress into yielding on tax increases with a stream of
meetings with a wide range of interest groups, including
businesses, non-profits, and governors of states.
"The president will continue to make the case that our
nation's businesses need the certainty that middle class
families won't see their taxes go up at the end of the year," he