Politics
Obama calling for ‘tough compromises’ in fiscal cliff talks
Afterwards, Obama’s spokesman said the group had “agreed to do everything possible to find a solution” to avoid the cliff.
But doing so appeared closely linked to agreeing the broad lines of a deal on slashing the long-term deficit, an issue which has locked up policy-making in Washington for two years.
Even if the fiscal cliff is avoided, the government still will be confronted with a massive debt load of US$16.2 trillion and a deficit that has topped US$1 trillion a year for four years running.
Debt rating agencies like Standard & Poor’s and Moody’s have warned that the US faces a possible downgrade this year if it does not get the deficit under control.
Until now the two parties have been split over how to correct the deficit: Republicans have insisted on spending cuts while Democrats say the focus needs to be more on raising revenues from taxes.
But in recent days the two sides have said they are willing to negotiate both tax revenue increases and paring back expenditures.
Boehner and Obama both proposed to shake up the tax system to eliminate loopholes and deductions, and Obama has signaled that he is ready to engage Republicans on the sensitive issue of “entitlement” spending on social programs like Social Security and Medicare.
“We understand that it has to be about cuts. It has to be about revenue,” said Pelosi.
Copyright 2012 AFP.
