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Tuesday 19 July 2011

Barack Obama hails 'progress' as debt deadline nears

US President Barack Obama has cited "some progress" in debt talks, with the US at the "11th hour" before a deadline to raise the nation's debt ceiling.

At the White House, Mr Obama hailed a plan by group of senators to cut the budget deficit and raise the limit.

And he urged congressional leaders to put aside "symbolic gestures" and begin writing legislation.

The US risks debt default on its debt if Congress does not raise the debt limit before 2 August.

At the White House, Mr Obama said a proposal had been put forward on Tuesday by a bipartisan "gang of six" senators.

The group has been meeting on and off in recent months in an effort to craft a plan to reduce the US government's $1.5tn (£927.81bn) annual budget deficit.

Mr Obama said the proposal was "consistent" with a plan the White House had been urging.

It was reported to include a mix of new revenues and cuts to military and social spending that in total would cut the budget deficit by about $3.7tn over the next ten years.

Mr Obama said in particular that the plan would broadly share the "sacrifice" across the political spectrum, with both Democrats and Republicans ceding on some of their policy priorities.

There have been sticking points on both sides of the political divide in recent months.

Republicans have been unwilling to consider raising new tax revenues to counter the growing budget deficits, while the Democrats have been resistant to cutting popular healthcare and welfare programmes for pensioners and the poor.
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