Tax Cut Battle Looms Over Bipartisan Summit as Obama Looks for Reset With GOP

President Obama, at a face-to-face meeting Tuesday with bipartisan congressional leaders, will have his first chance since his party's Election Day "shellacking" to reset relations with congressional Republicans and potentially crack the impasse over the Bush tax cuts.

The White House dialed down expectations ahead of the summit, which had been postponed from earlier this month. White House Press Secretary Robert Gibbs described the meeting, which could last an hour or more, as "the beginning of a conversation" and predicted participants would not emerge with a "full agreement" on the tax cuts.

But with the cuts set to expire at the end of the year unless Congress acts -- affecting just about every taxpaying American -- Gibbs said Obama "absolutely" does not want to see taxes rise for the middle class.

"And if others in Congress don't want to see that, then ... we're going to be forced to make a series of decisions that prevent that from happening. That's going to be the basis for and the beginning of those conversations starting tomorrow," Gibbs said.

The meeting will be the first post-election test of whether the White House and the incoming Republican House majority are able to find common ground on virtually anything.

Republicans and Democrats agree that taxes should not rise on the middle class -- the sticking point is whether the wealthy should be included in that extension. Republicans want the tax cuts extended for everybody. Democrats originally called for taxes to rise on those households making over $250,000 a year -- some Democrats have since started talking about increasing that salary threshold to $1 million a year.

Obama, who proposed a two-year federal pay freeze Monday, said that he hopes the sit-down Tuesday will mark "a first step toward a new and productive working relationship."

But the White House did not prescribe a compromise Monday, and top Republicans so far have shown little sign of budging.

The official blog for House Republican Leader John Boehner, in line to be the next speaker of the House, slammed Democrats on Monday following reports that they were standing by a partial tax increase.

"All this dithering and doubling-down only validates the American people's repudiation of Washington and politicians who refuse to listen," the blog said, urging Congress to "stop all the tax hikes and start cutting spending."

As for the possibility of only raising taxes on those making above $1 million, Senate Republican Leader Mitch McConnell said in a written statement to The Washington Post that any tax increase is a "horrible idea."

Still, he said, "it's not too late for both parties to work together." Some have said a temporary extension for the wealthy is possible.

Despite the drama over the tax cuts, the agenda for the lame-duck session of Congress is much broader. Gibbs said the ratification of the arms reduction treaty with Russia known as START is the other top item on the table for Tuesday's meeting.

And Congress is tasked with belatedly approving the fiscal 2011 budget or face a shutdown, and it must decide whether to extend long-term jobless benefits and repeal the military's "don't ask, don't tell" policy banning gays from serving openly in the military. Democrats also want to push a bill that would give some young illegal immigrants a path to legal residency provided they attend college or join the military.

Democratic strategist Joe Trippi said the tax cuts debate could easily become a "game of chicken" between the two parties. He predicted that Congress would ultimately extend the tax rates for the middle class, but questioned whether the critical debate over the burden on the wealthy would spill into next year.

"Hopefully, tomorrow's meeting will come to some agreement," he said.