Obama continues to push 'largest possible deal'

The benchmark Standard & Poor's 500 Index dropped 1.75 percent to 1,320.27 at 1:15 p.m. Monday in New York. The Dow Jones Industrial Average fell 1.26 percent to 12,497.63.

Treasury 10-year yields slid to the lowest level this month, dropping eight basis points, or 0.08 percentage point, to 2.95 percent at 12:41 p.m. in New York, according to Bloomberg Bond Trader prices.

The White House isn't seeking any tax increase before 2013, Obama said. The tax increases he is seeking would target "millionaires and billionaires" and "corporate loopholes," he said.

Democratic officials have said Obama is aiming at tax breaks for corporate jets, oil and gas subsidies, carried- interest income of hedge fund managers and "last-in, first- out" inventory accounting.

'Baffling' tax increases

Don Stewart, a spokesman for Senate Minority Leader Mitch McConnell of Kentucky, underscored Republicans' opposition to any tax increases, in a statement after Sunday night's meeting.

"It's baffling that the president and his party continue to insist on massive tax hikes in the middle of a jobs crisis while refusing to take significant action on spending reductions at a time of record deficits," Stewart said.

On July 9, Boehner, an Ohio Republican, said following a phone conversation with Obama that, amid the stalemate over taxes, all sides must settle for a smaller plan than the president seeks. Before yesterday's White House meeting, Obama said "we need to" reach an agreement within the next 10 days.

During the meeting, Obama said he believed a bigger deal might be politically easier, with both sides making philosophically difficult concessions, said a Democrat familiar with the discussions. The president asked Republicans to return Moday with details of their proposal, including numbers, the person said.

Beyond 2012 election

Boehner and the president had both been aiming for a larger compromise that would extend the debt ceiling through the next election in 2012. House and Senate Republicans are insisting that spending cuts exceed any increase in the debt ceiling.

Republicans including Cantor, a participant in previous bipartisan debt talks led by Vice President Joe Biden, say that group had identified between $2 trillion and $2.5 trillion in spending cuts that could serve as a framework for an agreement between Obama and congressional leaders.

Democrats, including Maryland Representative Chris Van Hollen, who participated in the Biden effort, say Democrats never agreed to that amount without new revenue in the mix.