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US lawmakers still far apart on debt agreement

US lawmakers still far apart on debt agreement

President Barack Obama and Republican lawmakers, seemingly trapped in inflexible bargaining positions, remain far apart on a deal to avert a first-ever default on the country's financial obligations.
Congressional leaders were asked to return to the White House for more talks Tuesday afternoon after a 90-minute Monday session produced no progress other than to identify the size of the gap between Republicans and Obama.
An Aug. 2 deadline looms for Congress to raise the country's debt limit. Republicans are insisting on major budget cuts to reduce the swollen deficit. Obama and his fellow Democrats are also offering budget cuts but in tandem with tax increases that the Republicans say they won't support.
Both Democratic and Republican leaders agree the U.S. shouldn't be allowed to default on its obligations, which could skyrocket interest rates, send stock markets plunging and shatter faith in the world's No. 1 economy.
The showdown comes as Obama and lawmakers head into next year's presidential and congressional elections.
After another round of talks Monday, neither side showed any give that might generate hopes for a speedy agreement on the $2 trillion-plus in budget cuts.
Instead, Republicans again took a firm stand against revenue increases, while Obama and his Democratic allies insisted that they be part of any equation that cuts benefit programs for the elderly.
"I do not see a path to a deal if they don't budge, period," Obama said at a news conference Monday.
At the same time, the president turned up the pressure by announcing he won't sign any short-term debt limit increases.
Obama's declaration seemed aimed at pressuring lawmakers to continue to strive for the largest deficit reduction plan possible, even though hopes for a "grand bargain" mixing a complete overhaul of the tax code with cuts to benefits programs fizzled over the weekend.
An advocate of the bigger bargain, House Speaker John Boehner, a Republican, explored the idea but stopped it in its infancy after learning the extent of White House demands for tax increases.
"The American people will not accept _ and the House cannot pass _ a bill that raises taxes on job creators," Boehner said Monday before heading to the White House.
At issue is the government's ability to borrow more to pay existing debt obligations and to run certain day-to-day operations. The U.S. blew past the existing $14.3 trillion borrowing limit on May 16. The Treasury Department has used accounting footwork to keep accounts in the black, but says the government could begin defaulting on its obligations if the debt ceiling isn't increased by Aug. 2.
Despite lingering hopes for a larger deal, the goal of the talks is to produce spending cuts of at least $2.4 trillion or so over the coming decade. Such cuts wouldn't do enough to address deficits that threaten the economy, but they would represent a downpayment on further reductions that would be imposed after next year's elections.
The group of negotiators includes Obama and other top administration officials and a bipartisan group of the eight top leaders of Congress.


Updated : 2021-05-07 19:46 GMT+08:00