U.S. President Barack Obama said he would sign into law a congressional compromise to avert the so-called fiscal cliff of automatic tax hikes and spending cuts while calling it a first battle in a wider war on the deficit.
While a hit that the fiscal cliff could have posed to the US and global economy was averted with the deal, it is only a reprieve, Obama warned, as the 10-per-cent, across-the-board spending cuts were delayed for two months and the US government approaches its debt ceiling.
He said he was "very open to compromise," acknowledging that a pet programme for his Democratic Party, Medicare, government health insurance for older Americans, was the biggest contributor to the deficit and needed to be reformed.
But he also insisted the upcoming budget battles focus on closing tax loopholes for rich Americans, incentivize innovation, create jobs and improve infrastructure to encourage economic growth and "broaden opportunity for everybody."
He also sounded a warning about the debt ceiling and replaying previous bitter partisan battles over it in Congress: "I will not have another debate with this Congress about whether they should pay the bills that they have already racked up."
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