Obama, Hill leaders at pivotal point on debt talks

July 10, 2011 - 4:14 AM
Obama

President Barack Obama crosses the South Lawn of the White House in Washington to board Marine One Saturday, July 9, 2011. Obama is headed to Camp David, the Presidential retreat in Catoctin Mountains. (AP Photo/Carolyn Kaster)

WASHINGTON (AP) — President Barack Obama and congressional leaders are regrouping after House Republicans gave up efforts for a massive deficit reduction package of $4 trillion over 10 years.

House Speaker John Boehner is now looking for a deal about half that size. But White House officials say the president will press for a bigger bargain one last time at a White House negotiating session Sunday evening. A deal would clear the way for an increase in the nation's debt limit.

Expectations for Sunday's meeting took an abrupt turn Saturday when Boehner announced that the White House's insistence on substantial new tax revenues scuttled a large deficit deal. He says a smaller package of about $2 trillion identified — but not agreed to — by bipartisan negotiators is more realistic.