Obama: 'modestly optimistic' fiscal cliff deal can be reached

WASHINGTON Sat Dec 29, 2012 5:45am IST

U.S. President Barack Obama opens his notes before remarks to reporters after meeting with congressional leaders at the White House in Washington December 28, 2012. REUTERS/Jonathan Ernst

U.S. President Barack Obama opens his notes before remarks to reporters after meeting with congressional leaders at the White House in Washington December 28, 2012.

Credit: Reuters/Jonathan Ernst

Related Topics

WASHINGTON (Reuters) - President Barack Obama held out hope for a last-minute agreement to avoid the "fiscal cliff" of tax increases and spending cuts after a meeting with congressional leaders, scolding Congress for leaving the problem unresolved until the eleventh hour.

"The hour for immediate action is here," he told reporters at the White House. "I'm modestly optimistic that an agreement can be achieved," he said.

Obama and lawmakers are working to prevent around $600 billion in combined federal spending cuts and tax increases, a shock economists say could stop the economic recovery in its tracks and perhaps reverberate beyond U.S. shores.

The president, who won re-election on a platform that included a pledge to raise taxes on top earners, said Senate leaders were working right now to craft a bipartisan measure that could win approval in both houses of Congress.

But if those last-ditch efforts were to fall short, lawmakers should hold a vote on a "bare minimum" measure that would extend existing tax rates for all but the wealthiest Americans and extend unemployment insurance, he said.

Obama took Congress to task for stalling on negotiations in a manner that is reminiscent of the 2011 stalemate that brought the nation close to the brink of defaulting on its debt and that hurt the economic recovery.

"This is déjà vu all over again," he said.

"America wonders why it is that in this town for some reason you can't get stuff done in an organized timetable," he added. "Well, we're now at the last minute."

The president said the latest budget impasse was once again harming economic growth.

"Already you're seeing businesses and consumers starting to hold back because of the dysfunction that they see in Washington."

(Reporting By Mark Felsenthal; editing by Todd Eastham)

FILED UNDER:

Surprise Rate Cut

Reuters Showcase

Eicher Share Sale

Eicher Share Sale

Truck maker Volvo sells shares in Eicher Motors  Full Article 

Services Growth

Services Growth

Services growth at eight-month high in Feb - HSBC PMI  Full Article 

StanChart Results

StanChart Results

StanChart rules out share sale as profit plunges 25 pct  Full Article 

Bond Market

Bond Market

Bonds at 20-month highs, rupee gains after surprise rate cut  Full Article 

Jim O’Neill Interview

Jim O’Neill Interview

'India can become world’s fifth-largest economy by decade’s end'  Full Article 

Coal Imports

Coal Imports

India coal imports in Feb jump from year ago, but drop m/m  Full Article 

China Services

China Services

China Feb HSBC services PMI edges up to 52.0 as orders improve  Full Article 

Next Superhero

Next Superhero

Franchise Man swoops in to save Bollywood  Full Article 

Budget 2015

Budget 2015

Budget announcements and reactions from the industry  Full Coverage 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage