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Obama calls meeting with leaders 'constructive'

By Jim Kuhnhenn

Associated Press

Published: Thursday, July 7 2011 1:16 p.m. MDT

She said she opposed "the very idea of having these essential programs on the table, being forced to put them on the table by Republicans who want to protect the wealth of the wealthiest Americans."

One official familiar with the negotiations said that an option under discussion would allow Republicans to make a commitment to overhaul and simplify the tax system, an effort that would lower individual and corporate tax rates while closing loopholes, ending some deductions and limiting other tax subsidies. Those changes could generate tax revenue and were a central element of a deficit reduction plan proposed by a bipartisan commission early this year.

Some Republicans argue that a simplified tax system would increase economic activity and that in itself would result in increased tax revenue.

Amid media reports Thursday of Social Security's inclusion in the debt-cutting talks, Obama spokesman Carney pushed back.

"There is no news here — the president has always said that while Social Security is not a major driver of the deficit, we do need to strengthen the program," Carney said, providing that any such effort "doesn't slash benefits." His statement did not directly address the possibility of reducing annual Social Security increases by changing the inflation adjustments.

Later, while briefing reporters, Carney added: "We have not put restrictions on what is brought into the room or put on the table."

Two Democratic officials allied with Obama said the president believes it would be easier to win bipartisan support in the House and Senate for a deal that embraces larger deficit cuts closer to the $4 trillion over 12 years that Obama proposed in April.

The officials, speaking on the condition of anonymity to discuss the private negotiations more freely, said the precise number was still in flux, but they said Obama would be making the case for more rather than less deficit reduction in his discussions with congressional leaders Thursday. The negotiations were the first official sit-down since last month, when House Majority Leader Eric Cantor, R-Va., left talks that had been led by Vice President Joe Biden, citing an insistence by Democrats on raising taxes.

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