President Barack Obama and Republican House Speaker John Boehner met Monday for 45 minutes as part of efforts to forge a compromise averting the "fiscal cliff" of automatic tax hikes and spending cuts, which some fear would trigger a new recession, aides said.
"The president and the speaker are meeting at the White House to continue their discussions about the fiscal cliff and balanced deficit reduction," a White House official said on condition of anonymity. A Boehner aide confirmed the meeting.
The two leaders have traded offers and counteroffers without really ever reporting concrete progress towards a deal that is expected to pair tax hikes on the wealthiest Americans (an Obama demand) with deeper cuts in entitlement spending (a Republican goal).
Absent a breakthrough by Jan. 1, income taxes will rise across the board, the payroll tax holiday will end, some unemployment benefits will dry up, and the government will face deep cuts to domestic and military spending. Economists have warned that, taken together, these steps could push the weak economy into a new recession.
According to news reports, Boehner's latest offer, delivered Friday, includes $1 trillion in new tax revenues over 10 years. It would see tax rates rise on people who make more than $1 million annually. The speaker also reportedly offered to increase the government's ability to borrow enough to last through 2013, but only if the president agrees to spending cuts proportional to the amount the debt ceiling will be raised.
Even if the two leaders work out a deal, the compromise would need to win passage in the Republican-led House of Representatives and the Democratic-held Senate.