Obama, Lawmakers Hold Sunday Talks on Deficit, Debt Deal

U.S. President Barack Obama and congressional leaders met again at the White House on Sunday, trying to overcome disagreements blocking a compromise to reduce federal deficit spending and raise the government debt limit. More talks are planned for Monday, and President Obama will hold a news conference focusing on the deficit and debt negotiations.

Neither the president nor the eight House and Senate lawmakers made formal opening comments at the start of the unusual Sunday meeting, one Mr. Obama said last week would mark the beginning of "hard bargaining" to achieve a compromise.

In a brief response to a reporter who asked if the president thought an agreement could be worked out by July 22, an early deadline to allow Congress to complete action on a debt ceiling increase by August 2, Mr. Obama said, "We need to."

As the television cameras rolled, the president was smiling. The Republican speaker of the House of Representatives, John Boehner, and Democratic Senate Majority Leader Harry Reid were not. The meeting ended after about 75 minutes, with no statements to the news media.

White House officials confirmed that another round of discussions will take place on Monday.

Earlier, administration officials and key Republicans and Democrats reiterated their positions after Boehner said he had concluded that a $4 trillion multi-year deficit-cutting package was not achievable.

White House Chief of Staff William Daley, speaking on ABC's This Week, said it was "unfortunate" that Boehner gave up on a broader deal, adding that Mr. Obama would use the Sunday talks to renew his push for a large deficit-reduction deal. "He is not someone to walk away from a tough fight. This is a very tough political fight, no question about it, but he didn't come to this town to do little things, he came to do big things," he said.

Daley said Republicans' resistance to including new tax revenues in any deal remains "the heart of the debate." But Daley said he is confident there will be a deal to avoid a government default, with an agreement that must involve "shared pain [and] responsibility."

Treasury Secretary Timothy Geithner said Mr. Obama will continue to attempt to forge a compromise. Geither warned of what he called a "grave moment facing the nation" and said Congress has no choice but to act.

Geithner appeared on NBC's Meet the Press. "There is no credible way to give Congress more time. There is no constitutional option, there is no delay option, there is no creative financial option. They have to act by [August 2]," he said.

Geithner said Mr. Obama is willing to do "very difficult political things" as part of a balanced long-term budget agreement, including "sensible ways" to find savings in major programs such as Social Security and Medicare, without increasing burdens on the middle class and elderly Americans.

Senate Minority Leader Mitch McConnell indicated that Republicans in Congress know that ultimately the U.S. debt limit must be raised, but will use the debate to drive home their points about deficit spending. "The secretary of the Treasury has said we need to do this, and we're using this as an opportunity to have a discussion about doing something about spending and debt," he said.

Mr. Obama's latest statement on the deficit and debt issues came in his weekly address to the nation Saturday, a day after the United States absorbed more difficult economic news with figures showing unemployment back up to 9.2 percent. "With a recovery that is still fragile and isn't producing all the jobs that we need, the last thing that we can afford is the usual partisan game-playing in Washington," he said.

Just over three weeks remain before the August 2 deadline to raise the debt limit. Congress, however, needs to act well before that, likely by July 22, to allow time for the procedural and legislative steps leading to House and Senate approval.