Obama addresses fiscal cliff, warns taxes must rise on wealthy

US President Barack Obama Friday claimed a mandate to hike taxes on the rich to pay down the deficit, firing his first post-election shot at Republicans in a year-end showdown on debt and spending.

The president also announced in a punchy, televised White House appearance, his first since his election night address, that he would invite top Republican and Democratic leaders to the White House next week.

The talks will focus on averting the so-called “fiscal cliff” - a catastrophic blend of automatic tax rises and harsh spending cuts due to come into force on January 1, which analysts warn could cause a new recession.

The showdown will be a crucial test of whether the newly reelected Obama can bend gridlocked Washington to his political will, with implications for his capacity to enact his second term agenda.

Obama campaigned on raising taxes on the rich to pay for deficit reductions and to finance spending on education and in other areas likely to make the economy more equitable and improve the lot of the hurting middle classes.

“We can’t just cut our way to prosperity. If we are serious about reducing the deficit, we have to combine spending cuts with revenue, and that means asking the wealthiest Americans to pay a little more in taxes,” he said Friday.