President Barack Obama insisted he is optimistic the "fiscal cliff" will be resolved, saying he and Republican House Speaker John Boehner are only a "few hundred billion dollars" apart.
"I've said I'm willing to make some cuts," Mr. Obama said at a news conference in Washington. "What separates us is probably a few hundred billion dollars. The idea that we would put our economy at risk because you can't bridge that gap doesn't make a lot of sense."
The comment came as talks on avoiding some $600-billion (U.S.) in scheduled tax increases and spending cuts – extreme budget austerity that has come to be known as the "fiscal cliff" – appear at risk of hitting another impasse.
Earlier Wednesday, White House spokesman Dan Pfeiffer said Mr. Obama would veto Mr. Boehner's "Plan B" proposal to protect everyone who earns less than $1-million from tax increases. The White House criticized the initiative as a gimmick that asks far too little of the country's wealthiest people. Mr. Boehner appeared intent on calling a vote on his plan regardless.
"Tomorrow, the House will pass legislation to make permanent tax relief for 98.1 per cent of American people," Mr. Boehner said in an appearance before reporters that lasted less than a minute. "Then the President will have a decision to make. He can call on Senate Democrats to pass that bill, or he can be responsible for the largest tax increase in American history."
The President – who called the news conference to announce that Vice-President Joe Biden will lead an ad-hoc commission on gun violence – said he'd like to finish a budget agreement with Mr. Boehner before Christmas. He also said he would reach out to congressional leaders over the next couple of days in an attempt to get a resolution.
However, Mr. Obama, who earlier this week offered for the first time to curb federal pension benefits, made no further concessions that might breathe life into talks that appeared at risk of running into another impasse.
"I'm prepared to get it done, but they're going to have to go ahead and make some adjustments," Mr. Obama said.
Most forecasters say failure to cushion the full impact of the "fiscal cliff" would cause a recession in 2013. Some $500-billion of the "cliff" is made up of temporary tax cuts that are due to expire. The rest comes from the first instalment of the across-the-board spending cuts that Congress and Mr. Obama agreed to last year as part of the agreement to raise the debt ceiling.
Even though the full force of those measures would only be felt over time, Jan. 1 has emerged as an arbitrary deadline to come up with a budget agreement. That means each side still has a time to hold out for a better deal. The rhetoric in Washington over the last 24 hours suggests politicians intend to use it.
Remove the bluster, and talks actually appear to be going well.
Mr. Boehner's willingness to call a vote on raising the tax rates of millionaires is a significant concession from a starting position of opposition to higher rates for anyone. Mr. Obama moved to meet him, calling for higher taxes on incomes above $400,000, a marked shift from his campaign pledge to raise the rates paid by households with annual incomes of more than $250,000. Mr. Obama now is seeking revenue of about $1.2-trillion over the next decade, and the latest Republican offer would generate $1-trillion.
The White House also has moved on spending. Mr. Obama this week said he would change the way Social Security and other benefit programs account for inflation, trimming benefits over the next decade by about $130-billion. The administration had stated earlier that it wanted to leave Social Security for another day. As with revenue, both sides are proposing spending cuts in the range of $1-trillion.