Obama to weigh in on 'fiscal cliff'

8:39 AM, Nov 9, 2012   |    comments
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(USA TODAY) -- President Obama makes his first bid on new budget talks Friday with a statement at the White House.

The president, who has largely stayed out of public sight in the two days since his re-election, is again expected to call on higher taxes for the wealthy as part of a "balanced" approach to start reducing the nations $16 trillion-plus federal debt.

At 1:05 p.m. in the East Room, Obama is scheduled to deliver a statement "about the action we need to keep our economy growing and reduce our deficit," says the White House schedule.

Obama is also expected to emphasize the need for Congress to work together to avoid a slew of tax hikes that would take effect at the start of the year in absence of a new deal with the White House.

Meanwhile, House Speaker John Boehner, R-Ohio, told USA TODAY's Susan Davis he will seek a short-term deal to delay the so-called "fiscal cliff," and that he will resist efforts to make major tax and spending changes in the lame duck session of Congress.

"I've never seen a lame duck Congress do big things," Boehner said. "And as speaker I feel pretty strongly that a lame duck Congress shouldn't do big things."

Boehner and other Republicans also argue that any tax increases would slow the economy and cost jobs.

From the Associated Press:

"A new Congressional Budget Office report on Thursday predicted that the economy would fall into recession if there is a protracted impasse in Washington and the government falls off the fiscal cliff for the entire year. Though most Capitol-watchers think that a long deadlock is unlikely, the analysts say such a scenario would cause a spike in the jobless rate to 9.1 percent by next fall.

"Some analysts believe that the fiscal cliff is more like a fiscal slope and that the economy could weather a short-term expiration of the George W. Bush-era tax cuts and that the government could manage a wave of automatic spending cuts for a few weeks. But at a minimum, going over the fiscal cliff would mean delays in filing taxes and obtaining refunds and would rattle financial markets as the economy struggles to recover.

"The CBO analysis says that the cliff -- a combination of automatic tax increases and spending cuts -- would cut the deficit by $503 billion through next September, but that the fiscal austerity would cause the economy to shrink by 0.5 percent next year and cost millions of jobs."

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