President Barack Obama, fighting to keep Democrats in charge of Congress, said on Wednesday the United States could not afford to extend Bush-era tax cuts for the rich and accused Republicans of being fiscally irresponsible.

On a campaign trip to Ohio roughly two months before November 2 midterm elections, Obama admitted his economic policies had not worked as quickly as hoped, but he said his party and proposals were still better placed to boost the US economy.

Obama's comments, infused with politics, came amid a growing row with Republicans over tax cuts for wealthy Americans enacted under former President George W Bush and set to expire at the end of this year.

John Boehner, the Republican leader in the House of Representatives, called for a two-year freeze on all current US tax rates and proposed the government cut spending for next year to 2008 levels, before the controversial federal bailouts and Obama's USD 814 billion stimulus plan.

Obama rejected that call but said his administration was ready to extend tax cuts for families making less than USD 250,000 a year.

"For any income over this amount, the tax rates would go back to what they were under President Clinton. This isn't to punish folks who are better off-God bless them-it is because we can't afford the USD 700 billion price tag," he said.

Republicans blame Obama for increasing the deficit with hundreds of billions of dollars in stimulus spending without delivering promised job growth.

The White House seeks to use a version of the same argument against them by saying extending Bush's tax cuts would increase the deficit, too.

With the unemployment rate at 9.6%, Obama's Democrats are struggling to keep control of the House in the November elections and may even lose the Senate.

Boehner said extending the cuts would give certainty to small businesses-a key constituency both parties see as crucial to boosting the sluggish economy.

"If we're able to do this together, I think we'll show the American people that we understand what's going on in the country and we'll be able to get our economy moving again and get jobs growing in America," he said on ABC's "Good Morning America" show.

Obama said the economy had improved since he took over from his Republican predecessor but the pace was slow.
"The economy is growing again. The financial markets have stabilized. The private sector has created jobs for the last eight months in a row," he said. "But the truth is, progress has been painfully slow.