The U.S. government will exhaust its borrowing authority on Dec. 31 and hit the $16.4 trillion federal debt limit, the Treasury Department said Wednesday, beginning a countdown until Congress either passes legislation to allow for more borrowing or the government defaults on its debt.
Treasury Secretary Timothy F. Geithner said in a letter to senior lawmakers that the Treasury would begin to undertake “extraordinary measures” in order to forestall default. Geithner said the measures could create about $200 billion in additional funding available to the government – giving Congress two months before it must raise the debt
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By Nancy Cordes
(CBS News) HAWAII – Democrats are now moving ahead on their own plan to avoid the so-called “fiscal cliff” now that talks have broken down with House Speaker John Boehner.
The White House and congressional leaders have until January 1 to work out a budget deal.
Lawmakers still see path to avert “fiscal cliff”
Watch: No Christmas miracle on “fiscal cliff”Complete coverage of the “fiscal cliff” negotiations
Whatever happens next may essentially be a last-ditch effort to avert the “fiscal cliff.” Sources tell CBS News that aides to the president have been in preliminary talks with aides to Senate Majority Leader Harry Reid, who himself was in Hawaii this weekend for the funeral of Sen. Daniel Inouye.
Reid is now working, sources say, on a smaller package than the comprehensive deal the president was working on with Boehner. The package would prevent tax rates from rising for middle-class families and perhaps cut some spending and tie up a few other loose ends… (Excerpt)
THE DAILY NEWS
In a Wednesday afternoon press conference that lasted under a minute, House Speaker John Boehner said President Obama should support his plan to avoid the fiscal cliff or “be responsible for the largest tax increase in American history.”
Optimistic despite a tightening deadline, President Barack Obama said Wednesday he and House Speaker John Boehner are “pretty close” to a grand fiscal deal to avoid a first-of-the-year shock to the economy, but that congressional Republicans “keep on finding ways to say no as opposed to finding ways to say yes.”
Obama cast a resolution to the “fiscal cliff” as a matter of political will. He said in the aftermath of the massacre of school children in Connecticut
, the nation deserves a compromise by its political leaders
“If this past week has done anything, it should just give us some perspective,” he said. And he urged lawmakers to “peel off the partisan war paint” and strike a deal.
Obama spoke to reporters at the White House
after announcing an administration-wide response to Friday’s shooting at an elementary school
in Newtown that killed 20 first-graders and six adults.
His comments came shortly after the White House threatened to veto Boehner’s backup plan for averting the “fiscal cliff.” Boehner’s measure, a so-called Plan B
, would block tax increases from being triggered Jan. 1 on everyone but those whose incomes exceed $1 million. …Continued.
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