WASHINGTON A top economic aide to President Barack Obama on Wednesday reiterated the administration was open to a sweeping deal to slow the rise in U.S. debt, provided that it was "balanced" and included tax revenues as well as spending cuts.
Wading into the debate over the country's looming 'fiscal cliff' amid calls for Obama to extend Bush-era tax cuts for wealthier Americans, White House National Economic Council Director Gene Sperling said the sacrifice must be broad-based.
"There is no reason that we as a country should not be able to come together on a balanced grand compromise," he said in prepared remarks to the Economic Club of New York.
But, he said that any deal must include "smart long-term entitlement savings, revenues from those who are most able to contribute, immediate support for jobs and the recovery, combined with a serious plan to bring down and stabilize our debt as a percentage of GDP (gross domestic product)."
Concerns about the durability of the U.S. economic recovery have boosted calls for Obama to extend Bush-era tax cuts for households making more than $250,000 a year.
Without action, they will expire at midnight on December 31. The White House says Obama continues to oppose extending those tax breaks, but does want to make existing tax cuts permanent for less affluent families.
However, the expiration of the tax breaks coincides with automatic spending cuts agreed by Republicans and Obama's Democrats under a pact to lift the nation's borrowing limit. That amounts to a 'fiscal cliff' that economists say will stunt U.S. growth unless Congress cuts some sort of deal on the debt.
Some analysts also expect that the debt limit could be reached before the end of the year, setting up another fight. Sperling said that the threat of forcing the country into a devastating default should never be brandished again.
"Few things could be as harmful to America's financial standing than an annual spectacle or annual countdown clock to whether or not America will be at risk of default," he said. "The era of threatening default by anyone of any party for any reason must be over."