Obama to speak on deficit reduction efforts Tuesday

Reuters News
Posted: Jul 05, 2011 4:23 PM
Obama to speak on deficit reduction efforts Tuesday

WASHINGTON (Reuters) - President Barack Obama will deliver remarks on Tuesday afternoon about the state of efforts to cut the U.S. budget deficit and raise the debt ceiling, the White House said.

Negotiations to raise the U.S. borrowing limit fell apart late last month and time is running short for lawmakers to reach an agreement on raising it or face a sovereign default.

Obama will speak on the issue at 4:40 p.m. EDT.

"The president will deliver brief remarks to discuss the status of efforts to find a balanced approach to deficit reduction," the White House said in a statement.

U.S. Treasury Secretary Timothy Geithner has warned of a potentially devastating default if Congress fails to raise the $14.3 trillion debt ceiling by August 2. The White House is looking to clinch a deal by July 22 to soothe market fears.

Democrats and Republicans disagree on how to solve the impasse. Democrats are insisting that some tax increases be included while Republicans say that would be bad for the economy, and are looking for straight spending cuts.

Talks led by U.S. Vice President Joe Biden meant to carve out a compromise broke down nearly two weeks ago. No schedule has been announced for further negotiations.

(Reporting by Alister Bull, Steve Holland, Jeff Mason and Laura MacInnis; Editing by Sandra Maler)