Fri, Nov 30, 2012 - Page 7 News List

Hints of concession offer hope of deal on US’ ‘fiscal cliff’

AP, WASHINGTON

The White House hinted at fresh concessions on taxes and cuts to government benefit programs on Wednesday as bargaining with Republicans lurched ahead to avoid the year-end “fiscal cliff” that threatens to send the US economy into a tailspin.

Increasing numbers of rank-and-file Republicans also said they were ready to give ground, a boost for US House of Representatives Speaker John Boehner and other party leaders, who say they will agree to higher tax revenues if benefit programs are also curbed to rein in federal deficits.

The goal of the talks is to produce a long-term deficit-cutting deal that will allow the cancelation of tax increases and spending cuts set for the end of the year.

“I’ll go anywhere and I’ll do whatever it takes to get this done,” US President Barack Obama said as he sough to pressure Republicans to accept his terms: a swift renewal of expiring tax cuts for all but the highest income earners.

However, there was no sign of tangible progress on an issue that marks a first test for divided government since elections that assured Obama a second term in the White House while renewing Republican control in the House.

House Democratic Speaker Nancy Pelosi told reporters the bargaining ought to begin where deficit talks between Obama and Boehner stalled 18 months ago.

She did not say so, but at the time, the two men were exchanging offers that included at least US$250 billion in cuts over a decade from Medicare, the popular government healthcare program for the elderly, and another US$100 billion from Medicaid, the healthcare program for the poor.

Those negotiations faltered in a hail of recriminations after the president upped his demand for additional tax revenue and conservatives balked.

Now, Obama has said he is open to alternatives to his proposal to raise additional tax revenue. Yet he says he will refuse to sign legislation that extends the current top rates on incomes higher than US$200,000 for individuals and US$250,000 for couples.

Instead, he is pushing Congress to renew expiring tax cuts for all income below those levels as an interim measure — an offer Boehner and many Republicans say is unacceptable because it would hike taxes on small businesses.

There are other political imperatives to consider.

Unemployment benefits expire for some of the long-term jobless at the end of the year. Additionally, the government is expected to need an increase in borrowing authority early next year or face the possibility of a default.

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