Fiscal Cliff Issue: Optimism between Obama and Congress Leaders

The US president and Congressional leaders took to microphones to talk about the problem of so-called fiscal cliff.

Barack Obama and representatives of both the House and Senate have voiced optimism over resolving the fiscal cliff of tax rises and spending cuts at the end of 2012. Photo: The White House/Flickr

Speaker John Boehner, House Minority Leader Nancy Pelosi, Senate Majority Leader Harry Reid and Senate Minority Leader Mitch McConnell all admitted that the meeting was quite constructive.

However, some controversial issues remain as Republicans, led in the House by Speaker Boehner, haven’t given up on fighting keeping tax rates for the wealthiest Americans from rising.

Nevertheless, the leaders suggested a framework had been put in place to reach a deal, which would include a mixture of raising tax revenues and pursuing entitlement reforms, The Huffington Post reports.

“We have the cornerstones of being able to work something out,” said Senate Majority Leader Harry Reid of Nevada, as leaders from both parties emerged from the White House.

“This is not something we’re going to wait until the last day of December to get done. We have a plan. We’re going to move forward on it.”

Boehner, who presented his framework for a broad tax-and-spending overhaul to be undertaken next year, also sounded an optimistic note.

“To show our seriousness, we’ve put revenue on the table, as long as it’s accompanied by significant spending cuts,” Boehner said.

“It’s going to be incumbent on my colleagues to show the American people we’re serious,” the Speaker added.

The U.S. president has called for high earners in the US to pay more in taxes.

“My hope is this is going to be the beginning of a fruitful process that we’re able to come to agreement that will reduce our deficit in a balanced way, that we will deal with some of these long-term impediments to growth and we’re also going to be focusing on making sure that middle class families are able to get ahead,” Mr Obama said before the talks began.

“I think we’re all aware that we have some urgent business to do. We’ve got to make sure that taxes don’t go up on middle class families, that our economy remains strong.”

The first part of the highly anticipated deal would reportedly be legislation this year that would commit Congress to specific revenue increases, favored by Democrats, and spending cuts, as advocated by Republicans.

“How those increases and cuts would be achieved would be worked out in the second stage next year by the new Congress”, The Los Angeles Times writes.

President Obama and Speaker Boehner appeared more comfortable together than a year ago, when they faced a disappointing failure to reach a $4-trillion deficit-reduction deal that many economists have warned is vital for the nation’s long-term fiscal health.

The two leaders exchanged a light moment as Barack Obama wished the speaker, who turns 63 last week, a happy birthday and gave the known Merlot fan an expensive bottle of Italian red wine.

After the meeting, White House press secretary Jay Carney said: “Both sides agreed that while there may be differences in our preferred approaches, we will continue a constructive process to find a solution and come to a conclusion as soon as possible.”

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