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Obama embraces GOP bigs as he signs tax-cut legislation

WASHINGTON — President Obama yesterday took ownership of the Bush tax cuts.

Obama signed into law an $858 billion bill negotiated with Republicans that extends Bush-era tax cuts for all income levels — including breaks that he once decried for the highest earners.

Clearly moving from the left to the center, Obama even agreed to lower the inheritance tax on the wealthiest Americans as sought by Republicans — enraging his liberal Democratic friends.

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But Obama won concessions of his own as part of the bipartisan tax deal: a one-year cut in the payroll tax for workers and a 13-month extension of benefits for the jobless.

Obama called the tax package “a substantial victory for middle-class families across the country.”

“They’re the ones hit hardest by the recession we’ve endured. They’re the ones who need relief right now. And that’s what is at the heart of this bill,” he said.

Obama said he would not allow partisan bickering to cause a massive tax hike that would hurt Americans and damage a fragile economy.

During the ceremony, Obama spent more time stroking Republican leaders than fellow Democrats.

There was a reason: House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid boycotted the event.

Staffers in Pelosi’s and Reid’s offices insisted that they could not get to the White House because they were swamped on Capitol Hill wrapping up a host of bills before Congress adjourns in the next week or so. But Capitol insiders said neither was thrilled with the Obama-GOP tax deal.

Senate Republican Leader Mitch McConnell (R-Ky.) turned out to be Obama’s new bosom buddy.

Both Obama and Vice President Joe Biden pointedly praised McConnell for crafting a compromise with the White House. The president also noted that the deal passed both houses of Congress by “wide bipartisan margins.”

McConnell couldn’t have been more pleased.

“Republicans have fought hard for this legislation,” he said. “Up until last week, most Democrats resisted, but in the end, the American people were heard — and that’s a welcome change from the past two years.”

What’s in the bill:

* Extends for two years the Bush income-tax cuts for all income levels

* Cuts payroll tax next year from 6.2% to 4.2%

* Permits businesses to write off capital investments in software and equipment

* Levies a 35% tax on estates, exempting the first $5 million

* Extends unemployment insurance benefits for at least 13 months

* Costs $858 billion

churt@nypost.com