–Won’t Sign 30-,60- or 90-Day Deal on Debt Limit
–Both Sides Must Give Ground on ‘Sacred Cows’

By Heather Scott

WASHINGTON (MNI) – President Barack Obama laid down a gauntlet
Monday saying he will not sign a short-term, stopgap measure to raise
the debt limit and push the hard work on a larger deal to reduce the
deficit into election season when it will only be harder to achieve.

But at the same time Obama struck a conciliatory note saying he is
willing to compromise and take heat from his own party in order to “do
something meaningful” on the debt and deficit issues.

Following another brief, failed meeting with congressional leaders
Sunday evening, which followed House Speaker John Boehner’s announcement
Saturday night that a big package like the $2.4 trillion deal being
considered would not pass and would not be the focus of the talks, Obama
held a news conference to urge both side to “give up their sacred cows.”

Obama and Vice President Biden met Sunday at the White House for 75
minutes with Senate Majority Leader Harry Reid, Senate Minority Leader
Mitch McConnell, House Speaker John Boehner, House Minority Leader Nancy
Pelosi, Senate Majority Whip Dick Durbin, Senate Minority Whip Jon Kyl,
House Majority Leader Eric Cantor and House Minority Whip Steny Hoyer.

The talks reconvene at 2:00 p.m. ET Monday.

Obama rejected Boehner’s suggestion that leaders will only be able
to reach a short-term agreement.

“I will not sign a 30-, 60- or 90-day extension. That is just not
an acceptable approach,” Obama told reporters. “This is the United
States of America. We do not manage our affairs in three-month
increments. We don’t risk default on our obligations because we can’t
put politics aside.”

It is irresponsible to fail to raise the debt ceiling and allow the
United States to default, he said. “We cannot threaten the full faith
and credit for the first time in our history.”

Leaders “must resolve this in a serious way” for a reasonable
period, and talks will continue every day through the weekend if
necessary, Obama said, adding that he will continue to push leaders from
both sides for the largest possible deal now.

Pushing the hard work of achieving a large deal down the road would
only make it harder, especially as the November election season
approaches.

“Now is the time … . If not now, when?”

With a deal to get the deficit to a manageable level and stabilized
the debt, “the economy as a whole would benefit,” he said, especially if
political leaders “defy expectations” and do what is right for the
country.

But he acknowledged that if each side sticks to its “maximalist”
position, a deal cannot be reached.

Obama stressed that he agreed to spending cuts to make government
“leaner and meaner” including in defense and health care, and would
agree to cuts in entitlement programs that would lower costs while
preserving the programs.

However, he held the line saying the whole burden cannot be borne
by “those who can least afford it.”

“It is possible for us to construct a package that would be
balanced, would share sacrifice, would involve both parties taking on
their sacred cows, would involve some meaningful changes to Medicare, to
Social Security and Medicaid that would preserve the integrity of the
programs,” Obama said.

“It is possible for us to bring in revenues that does not impede
our current recovery, but is fair and balanced.”

He denied that he is pushing for near-term tax increases, saying
the proposal under discussion would close only the most egregious tax
loopholes starting in 2013. “Millionaires and billionaires can afford to
pay a little more.”

However, failure to extend the payroll tax cut implemented as part
of the recovery program would amount to a tax increase, he said, noting
that he favors extending the measure since it does help the economy.

Obama also said that while the administration and lawmakers are
working on a tough debt and deficit deal, it would be a good time to
include a reform of Social Security.

** Market News International Washington Bureau: 202-371-2121 **

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