Obama: 'We're not that far apart'

WASHINGTON, Dec. 21 (UPI) -- Calling himself a "hopeless optimist," U.S. President Barack Obama Friday said a deal can be fashioned to avert the "fiscal cliff" if everyone will compromise.

Without offering any new proposals, Obama said he spoke with House Speaker John Boehner, R-Ohio, despite the latter's inability to whip his caucus into line Thursday, and met with Senate Majority Leader Harry Reid, D-Nev., for further discussions on preventing a combination of tax increases and spending cuts from kicking in at the end of 2012.

"Call me a hopeless optimist," Obama said. "I still think we can get it done."

The statement followed an embarrassing defeat for Boehner, who was unable to muster the votes for his backup plan, which would have preserved current tax rates on all income under $1 million and allowed marginal rates to rise on income exceeding that amount. Boehner was force late Thursday to cancel a vote on the measure, which was designed as a negotiating tool that could give cover to Republicans if a deal with Obama could not be reached before Jan. 1.

Rep. Mick Mulvaney, R-S.C., said opposition to Boehner's Plan B was broad-based because the plan "didn't fix the problem" of deficit spending.

"Bring us something that actually solves the problem and we will look at it," he told MSNBC.

Obama again urged the House to adopt legislation that would keep current tax rates in place on the first $250,000 of income to prevent the average taxpayer from seeing a tax increase of $2,200 in 2013.

"Averting a middle class tax hike is not a Democratic responsibility or a Republican responsibility," Obama said. "With their votes, Americans have determined governing is a shared responsibility. ... Nobody gets 100 percent of what they want. Everybody has to give a little bit in a sensible way."

Obama said he had met halfway on tax increases and more than halfway on spending cuts because reducing the deficit "is the right thing to do for the long-term health of the economy."

"We're not that far apart," he said.

Obama said he hopes lawmakers use the Christmas break to cool off.

"Drink some eggnog. Have some Christmas cookies. Sing some Christmas carols," he said, but then every member of Congress should "think about their obligations to the people who sent us here."

Obama said it would be folly to allow the economy to go over the "fiscal cliff" just as the economy is beginning to recover.

"Now's not the time for more self-inflicted wounds, certainly not those coming from Washington," he said in an oblique reference to the debt limit debate 18 months ago that resulted in a downgrading of the U.S. credit rating.

Obama said lawmakers need to remove the politics from the process and do what is right for the country.

"This is not simply a contest between parties as to who looks good and who doesn't," he said.

After pulling his bill, Boehner unexpectedly disbanded the House until after Christmas.

"The House did not take up the tax measure today because it did not have sufficient support from our members to pass," Boehner said in a statement Thursday night.

He then put the onus on Obama and Reid to take the next step.

"Now it is up to the president to work with Senator Reid on legislation to avert the fiscal cliff," Boehner's statement said.