U.S. congressional leaders are scheduled to meet again with President Barack Obama Tuesday, with no signs of progress on a deal to reduce the deficit and raise the government’s borrowing limit.
Tuesday’s talks come three weeks before the August 2 deadline, when the U.S. Treasury Department says the country will run up against the $14.3 trillion legal limit on debt and be forced to default on some payments.
The president wants to work out a deal before the deadline to give Congress time to debate and pass the measure. He has promised daily meetings until a deal is made, but Obama’s Democratic Party and opposition Republicans still appear to be far from an agreement.
The president proposes a $4 trillion package of spending cuts and revenue increases, while the Republicans say they will not allow tax hikes and want to focus only on slashing government spending.
Obama said at a televised news conference Monday it is time to stop playing politics and make a deal. He said he will refuse to sign any temporary measures to resolve the debt crisis.
Democrats vs Republicans
Democrats strongly oppose cuts in popular social programs for the poor and elderly. They say increasing taxes on the wealthy and big corporations is essential because the government badly needs more revenue to close the budget gap.
Republicans say it makes no sense to raise taxes on the wealthy because they are the ones who can invest in the economy and create jobs. The speaker of the House of Representatives, Republican John Boehner, has said no deal can pass the House unless it rules out tax increases and cuts spending.
Treasury Secretary Timothy Geithner said Tuesday the two sides understand what it will take to make a deal and will come to an agreement. He has warned previously that failing to raise the $14.3 trillion legal limit on what the government can borrow to pay its debts would be “catastrophic.”