Obama tough on fiscal cliff

2012-12-06 22:12
US President Barack Obama speaks during a press conference at the White House in Washington, DC. (File, AFP)

US President Barack Obama speaks during a press conference at the White House in Washington, DC. (File, AFP)

Multimedia   ·   User Galleries   ·   News in Pictures Send us your pictures  ·  Send us your stories

kalahari.com

  • The Amateur
    A gripping read that reveals never before published details about the Obama administration's... Now R321.00
    buy now

Washington - President Barack Obama and Republicans crept closer to negotiations on avoiding a recession-threatening package of automatic tax increases and spending cuts, but the White House reaffirmed it would not budge on demands for higher taxes on the wealthy.

With a new AP-GFK poll showing clear support for Obama's position and dwindling backing for cutting government services to curb the climbing US budget deficit, the president and House of Representatives Speaker John Boehner spoke by telephone on Wednesday for the first time in days about a way to avoid the so-called fiscal cliff which would occur on 1 January.

The telephone contact, disclosed by a Boehner spokesperson, raises the possibility that negotiations could soon resume on heading off what some economists warn could be a serious blow to an economy still recovering from the Great Recession.

So far, Republican leaders have said they would only agree to higher tax revenues by closing loopholes or reducing tax breaks, not by raising rates as demanded by Obama. The opposition has struggled, however, to remain united and find its footing in talks with a president emboldened by his November election victory and unified congressional Democrats.

While insisting that tax rates go up on the top 2% of American earners, Obama, too, has called for government spending cuts but by less than the Republicans want.

Obama, addressing business leaders on Wednesday, said the White House and Republicans could reach an agreement "in about a week" if the Republicans drop their opposition to raising taxes on families making more than $250 000 a year.

"If we can get the leadership on the Republican side to take that framework, to acknowledge that reality, than the numbers actually aren't that far apart," Obama said.

Administration officials are hardening their warnings that Obama is willing to risk going over the cliff. Treasury Secretary Timothy Geithner said on Wednesday that the Obama administration is "absolutely" ready for that risky step.

Progress inevitable

Geithner said in an interview on CNBC the administration thinks budget deficits are so large that they can't be closed without boosting tax rates on the wealthiest 2% of Americans. He also said that the administration would reject a budget plan that didn't include an increase in the federal borrowing limit, which is expected to expire early next year.

However, Geithner said he still thinks progress is being made in the budget negotiations and that the outlines of an agreement are becoming clearer.

"They look inevitable," he said.

Speaking to business chieftains Wednesday, Obama warned Republicans not to inject the threat of a government default into negotiations over the fiscal cliff as a way of extracting concessions on spending cuts. "It's not a game I will play," he said, recalling the brinkmanship of last year in which a budget standoff pushed the Treasury to the edge of a first-ever default and led to a downgrade of the US credit rating.

While saying he is willing to accept some reductions in government programs such as Medicare, the highly popular federal health insurance programmes for older Americans, he flatly rejects Republican contentions that they can raise about $800bn in additional government revenue over a decade by closing loopholes and narrowing tax deductions on the wealthy, rather than raising income tax rates.

The opposition argues increasing rates from 35% to 39.6% as Obama wants would impose a particularly harmful impact on the economy and job creation at a time when the country is still struggling to recover fully from the deepest recession in decades.

The White House has ridiculed the Republican plan as "magic beans and fairy dust."

- AP

Read more on:    barack obama  |  us
NEXT ON NEWS24X

SHARE:

Read News24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Add your comment
Comment 0 characters remaining
 

Inside News24

 
/News
 
Traffic
Lottery
 
  • Tuesday Epping - 10:06 AM
    Road name: N7 Vanguard Drive
    TRAFFIC LIGHTS not working at Bofors Circle
  • Tuesday Kuils River - 08:34 AM
    Road name: Polkadraai Road Eastbound
    ROADWORKS between the R102 Van Riebeeck Road and the R310 Baden Powell Drive exit - DELAYS
 
More traffic reports...
 

Jobs in Cape Town [change area]

Property [change area]

Travel - Look, Book, Go!

Magical Massinga

Spend 5 nights at the gorgeous Massinga Beach Lodge in Mozambique and only pay for 4 from R13 220 per person sharing. Includes return flights, accommodation, transfers and romantic turndown. Book now!

Kalahari.com - shop online today

30% off academic books

Score a mind blowing 30% off academic books! Offer valid while stocks last. Shop now!

40% off appliances & homeware

Get mind blowing deals on top selling appliances and homeware. Offer valid while stocks last. Shop now!

Lenovo A1000 tablet now R999!

Get the Lenovo A1000 tablet for only R999! Offer valid while stocks last. Shop now!

Mind blowing deals on electronics!

Save up to 35% on electronics. Offer valid while stocks last. Shop now!

New gobii smartphones from R999!

Front and rear camera's, dual SIM capability and 200MB of FREE Cell C data every month for 12 months, are just some of the many features on these smartphones. Get yours now! Shop here.

OLX Free Classifieds [change area]

Samsung Galaxy s4

Mobile, Cell Phones in South Africa, Western Cape, Cape Town. Date October 24

Best bargain in big bay

Real Estate, Houses - Apartments for Sale in South Africa, Western Cape, Cape Town. Date October 25

VW Golf 6, 1.6 Trendline (Excellent condition)

Vehicles, Cars in South Africa, Western Cape, Cape Town. Date October 25

BlackBerry Bold 9780

BlackBerry 6 Engage your world with BlackBerry 6 OS on the...

From R3049.00

I'm shopping for:

Horoscopes
Aquarius
Aquarius

It may be hard to avoid an argument or heated conversation today. Someone may be stirring things up and testing your patience. ...read more

There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.








Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.