The Straits Times
Published on Dec 30, 2012

Obama says failure to reach fiscal deal would hurt markets


WASHINGTON (REUTERS) - Financial markets would be affected adversely if US lawmakers fail to agree on a "fiscal cliff" deal before Tuesday, President Barack Obama said in an interview broadcast on Sunday, while urging Congress to act quickly to extend tax cuts for middle-class Americans.

Lawmakers are seeking a last-minute deal that would set aside US$600 billion (S$734 billion) in tax increases and across-the-board government spending cuts that are set to start within days.

If Congress does not make that happen, the first bill brought up in the new year would be to reduce taxes for middle-income families, Obama told NBC's "Meet the Press." "Now I think that over the next 48 hours, my hope is that people recognise that, regardless of partisan differences, our top priority has to be to make sure that taxes on middle-class families do not go up. That would hurt our economy badly," Obama said in the interview taped on Saturday.

"We can get that done. Democrats and Republicans both say they don't want taxes to go up on middle-class families. That's something we all agree on. If we can get that done, that takes a big bite out of the 'fiscal cliff.' It avoids the worst outcomes," Obama added.