WASHINGTON, April 11 (UPI) -- U.S. Treasury Secretary Jack Lew Thursday said a grand bargain on the budget is close but any plan must raise more tax revenue.
In his first appearance on Capitol Hill since his confirmation, Lew told the House Ways and Means Committee the U.S. economy has recovered significantly and that balanced deficit reduction would spur growth.
He said the two sides were just "two turns of the wheel" from reaching a budget deal last December and he remained optimistic, MarketWatch reported.
"I think we are close to getting an agreement ... that I am still an optimist," he said. "We don't have an economic emergency in terms of the deficit right now."
Lew defended the administration's compromise offer to House Speaker John Boehner of $1.8 trillion in spending cuts, in addition to $2.5 trillion in deficit reduction already enacted, saying the $3.778 billion budget proposal released Wednesday "fully pays for all new initiatives to ensure that they do not add to our deficit burden. "
The White House is seeking $580 billion in new revenue from closing tax loopholes and tax breaks for the wealthiest Americans.
"The president's budget is based on a belief that an agreement to achieve balanced deficit reduction is consistent with making -- and fully paying for -- targeted investments critical to continued economic growth and job creation," Lew said in remarks prepared for testimony.
Lew cited the lowest national unemployment rate in four years, at 7.6 percent, average economic growth of more than 2 percent annually for the past 3 1/2 years, and the creation of 6.5 million private sector jobs since February 2010 as proof the administration's economic policies are working.
But he acknowledged even though corporate profits are at record levels the recovery remains fragile as the middle class continues to struggle.
"Too many Americans are still struggling to find work," Lew said. Despite recent improvements in the housing market, many families remain underwater on their mortgages and credit-worthy borrowers continue to have trouble getting the financing they need to buy a home or refinance existing mortgages."
He said "cutting too deeply or too soon would harm the recovery in the near term, undermining our shared fiscal goals and our ability to make necessary investments for growth over the long term."