Obama Still Optimistic Financial Deal Will Be Reached

Posted December 19th, 2012 at 3:45 pm (UTC-5)
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U.S. President Barack Obama says he is willing to do “some very tough things” to compromise with his political opponents in Congress on contentious year-end financial issues and is optimistic an agreement can be reached within days.

The president says he has reached a broad framework of government spending cuts and tax rates with the Republican leader of the House of Representatives, Speaker John Boehner.

“It cannot be done if every side wants a hundred percent, and part of what voters were looking for is some compromise up here. That is what folks want. They understand that they are not going to get 100 percent of what they want.”

The president says he is hopeful an agreement can be reached by Christmas, December 25. The White House and Congress are trying to avert about $500 billion in mandated spending cuts and tax increases set to take effect January 1.

Boehner has proposed legislation to extend a break for taxpayers earning up to $1 million annually, but the White House says the president would veto that legislation if it clears Congress. Mr. Obama is seeking to end the tax break for those earning more than $400,000.

Boehner said the House will pass his bill Thursday and the president should encourage Senate Democrats to pass it as well. He said if Mr. Obama does not approve the legislation he would be responsible for “the largest tax increase in American history.”

White House communications director Dan Pfeiffer says the Republican plan does not raise enough revenue from the country's top earners, and would leave a substantial deficit-reduction burden on the middle class.

Mr. Obama also has reduced his demand for more taxes over the next decade from $1.4 trillion to $1.2 trillion and said he would agree to a Republican call to curb spending for government pensions for retired workers by changing the way annual increases in the payments are calculated.

Even as they move closer to an agreement, the problem for Mr. Obama and Boehner is whether they can convince their political colleagues to support the emerging compromise. In the United States, Democrats have adamantly opposed any changes in Social Security, the pension plan for retirees, while Republicans have steadfastly stood against tax increases.