Barack Obama in emergency talks to secure US debt deal
Mutual acrimony has surrounded the talks to avert a debt default
US President Barack Obama has held an emergency meeting with congressional leaders in a last-ditch bid to avert an economically catastrophic debt default.
Mr Obama called the meeting after talks with Republican House Speaker John Boehner broke down on Friday.
Both Democrats and Republicans are divided on how to control future spending.
Congress must approve a plan to raise America's debt ceiling before the 2 August default deadline.
If the US fails to meet the deadline to raise the $14.3tn limit on US borrowing, the Treasury could run out of money to pay all of its bills - which could lead to interest rate rises, threaten the US economic recovery and in turn the global recovery.
Mr Obama was joined at the negotiating table on Saturday by his Vice-President Joe Biden, Mr Boehner, House Minority leader Nancy Pelosi, Democratic Senate Majority leader Harry Reid and Senate Republican leader Mitch McConnell.
The Associated Press reported that they were unsmiling as the meeting began and most of them avoided reporters when they left the White House.
The White House afterwards urged Congress to "refrain from playing reckless political games with our economy... and do its job, avoiding default and cutting the deficit".
Who owns the $14.3tn debt?
- US government owes itself $4.6tn
- Remaining $9.7tn owed to investors
- They include banks, pension funds, individual investors, and state/local/foreign governments
- China: $1.16tn, Japan: $0.91tn, UK: $0.35tn
- Deficit is annual difference between spending and revenue, $1.29tn in 2010
- Congress has voted to raise the US debt limit 10 times since 2001
Source: US Treasury, May 2011, Congressional Research Service, Congressional Budget Office
Both Mr McConnell and Mr Boehner issued statements saying they intended "to find a bipartisan solution to significantly reduce Washington spending and preserve the full faith and credit of the United States".
Aides said they expected to work through the weekend to come up with bill that would be acceptable to both sides for Monday.
On Friday, Mr Boehner accused the president of moving "the goal posts", saying they had been close to a deal until Mr Obama demanded $400bn in tax increases on top of about $800bn in revenues that would have been reaped through a comprehensive rewrite of the tax code.
Mr Obama had declared his deal as "extraordinarily fair", offering to cut $650bn from Medicare, Medicaid and other entitlements, as well as slashing $1tr in discretionary spending.
Republicans have been unwilling to consider raising new taxes to counter the growing budget deficits.
The Democrats have been opposed to cutting popular healthcare and welfare programmes for pensioners and the poor.
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