President Barack Obama will send Congress a scaled-back agreement to avoid some of the fiscal cliff’s automatic tax increases and budget cuts, a Democratic and Republican source told CNN.
Before leaving for Christmas break, Obama said he might consider a deal to extend the Bush-era tax cuts to all income levels below $1 million, while extending unemployment benefits, but leaving entitlements and a possible increase in the debt ceiling for negotiation after the new Congress takes office in January.
Obama and House Speaker John Boehner have jostled for most of the past month over whose taxes will increase in January as potential cuts to entitlements in order to avoid steep cuts to the defense budget.
"Nobody is willing to pull the trigger," Rep. Steve LaTourette, R-Ohio, said of the lack of an agreement, because "everybody wants to play the blame game. This blame game is about to put us over the edge."
With the country set to reach the fiscal cliff on Dec. 31, Obama cut short his holiday vacation as the Senate reconvened Thursday morning. The House remains on break, but members have said they could be back in Washington within 48 hours to vote on a package to avoid the cliff.
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