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Sequester deadline looms as US faces $85bn cuts Sequester deadline looms as US faces $85bn cuts
(35 minutes later)
US political leaders are meeting for last-ditch talks at the White House, amid the prospect of steep budget cuts. US political leaders have met for last-ditch talks at the White House, amid the prospect of steep budget cuts.
Cuts worth $85bn (£56bn), originally passed in an effort to push Congress to strike a budget deal, are due to become law by the end of Friday.Cuts worth $85bn (£56bn), originally passed in an effort to push Congress to strike a budget deal, are due to become law by the end of Friday.
President Barack Obama is hosting Democratic and Republican leaders, as a blame game rages in Washington. Congress has adjourned for the weekend. President Barack Obama hosted Democratic and Republican leaders, as a blame game rages in Washington. Congress has adjourned for the weekend.
The IMF has said the cuts could have an impact on global growth.The IMF has said the cuts could have an impact on global growth.
Analysis in the US suggests the nation's GDP (economic output) could grow by just 1.4% in 2013 if the cuts are not delayed or replaced. US GDP grew by 2.2% in 2012.Analysis in the US suggests the nation's GDP (economic output) could grow by just 1.4% in 2013 if the cuts are not delayed or replaced. US GDP grew by 2.2% in 2012.
It will be fascinating to see how Obama plays today.It will be fascinating to see how Obama plays today.
He has until midnight to sign an order making the cuts actually happen.He has until midnight to sign an order making the cuts actually happen.
So he has to, by law, do something he says will be disastrous.So he has to, by law, do something he says will be disastrous.
Will he do in front of the cameras? I doubt it. Will he speak first? Hard to avoid.Will he do in front of the cameras? I doubt it. Will he speak first? Hard to avoid.
This is all about political theatre and the blame game.This is all about political theatre and the blame game.
So far, opinion polls suggest more Americans blame Congress and the Republicans than the president.So far, opinion polls suggest more Americans blame Congress and the Republicans than the president.
Neither side looks pretty. Both look as though they care more about their own ideology than the damage that will be done to the economy.Neither side looks pretty. Both look as though they care more about their own ideology than the damage that will be done to the economy.
It is also a long game - there will be another budget deadline and probably a new crisis by the end of the month.It is also a long game - there will be another budget deadline and probably a new crisis by the end of the month.
Obama's whole strategy is to divide Republicans and paint them as intransigent wreckers.Obama's whole strategy is to divide Republicans and paint them as intransigent wreckers.
I expected him to look for advantage, not agreement.I expected him to look for advantage, not agreement.
The White House meeting comes as prospects for a deal to avert the cuts, known as the sequester, appear extremely slim. The White House meeting came as prospects for a deal to avert the cuts, known as the sequester, appeared slim.
"The American people know that Washington has a spending problem," Republican House Speaker John Boehner said as he left the meeting on Friday.
"While there are smarter ways to cut spending than the process that we are about to engage in," he continued, the House would not act before the Senate passed a bill.
He also said tax rises were not an option.
"Let's make it clear that the president got his tax hikes on 1 January," he said. "The discussion about revenue, in my view, is over. It's about taking on the spending problem."
Budget bills from both parties were defeated in the Senate on Thursday.Budget bills from both parties were defeated in the Senate on Thursday.
Although Republicans and Democrats both say they want to reduce the budget deficit, estimated at $845bn this year, the president accused Senate Republicans of allowing the cuts to proceed.Although Republicans and Democrats both say they want to reduce the budget deficit, estimated at $845bn this year, the president accused Senate Republicans of allowing the cuts to proceed.
Mr Obama favours what he calls a "balanced" approach to deficit reduction, mixing cuts with tax rises for some Americans.Mr Obama favours what he calls a "balanced" approach to deficit reduction, mixing cuts with tax rises for some Americans.
"They voted to let the entire burden of deficit reduction fall squarely on the middle class," he said of his rivals, in a statement on Thursday."They voted to let the entire burden of deficit reduction fall squarely on the middle class," he said of his rivals, in a statement on Thursday.
He criticised Republicans for refusing to close "a single tax loophole that benefits the well-off and well-connected."He criticised Republicans for refusing to close "a single tax loophole that benefits the well-off and well-connected."
The president said that by not doing a budget deal to avoid the cuts, Congress would impose a "self-inflicted wound" on America.The president said that by not doing a budget deal to avoid the cuts, Congress would impose a "self-inflicted wound" on America.
But Republicans contend that the president and his advisers created and proposed the idea of the cuts during budget negotiations in 2011.But Republicans contend that the president and his advisers created and proposed the idea of the cuts during budget negotiations in 2011.
House Speaker John Boehner has referred repeatedly to "the president's sequester", according to Politico.
'Tumble downward''Tumble downward'
Mr Boehner and House Democratic leader Nancy Pelosi, as well as the Senate's Democratic majority leader Harry Reid and Republican minority leader Mitch McConnell, arrived at the White House for talks that began at 10:18 EST (15:18 GMT), officials said. Ahead of the Friday morning meeting, reports said Mr Obama was still hoping to push for a wider fiscal deal to reduce the deficit by $1.5tn (£1tn) over the next 10 years.
Reports say Mr Obama is still hoping to push for a wider fiscal deal to reduce the deficit by $1.5tn (£1tn) over the next 10 years.
But attention will also turn to the next congressional challenge - a possible shutdown of the US government if no funding bill is passed in the next month.But attention will also turn to the next congressional challenge - a possible shutdown of the US government if no funding bill is passed in the next month.
The BBC's Mark Mardell in Washington says the cuts are meant to hurt - they were deliberately designed two years ago to be so brutally painful that politicians of left and right would be forced to agree on a better way of balancing the books.The BBC's Mark Mardell in Washington says the cuts are meant to hurt - they were deliberately designed two years ago to be so brutally painful that politicians of left and right would be forced to agree on a better way of balancing the books.
The cuts are split roughly evenly between military and domestic programmes, but effects will be felt over time rather than immediately.The cuts are split roughly evenly between military and domestic programmes, but effects will be felt over time rather than immediately.
While hundreds of thousands of jobs are expected to be lost, no US government programmes will be closed down entirely. Cuts to healthcare provision for the elderly will be limited.While hundreds of thousands of jobs are expected to be lost, no US government programmes will be closed down entirely. Cuts to healthcare provision for the elderly will be limited.
The scale of cuts will increase gradually over 10 years, totalling $1.1tn by 2023, according to the non-partisan Congressional Budget Office.The scale of cuts will increase gradually over 10 years, totalling $1.1tn by 2023, according to the non-partisan Congressional Budget Office.
If there is no agreement, they are scheduled to be signed into the federal budget by President Obama by 23:59 local time on Friday (04:59 GMT on Saturday).If there is no agreement, they are scheduled to be signed into the federal budget by President Obama by 23:59 local time on Friday (04:59 GMT on Saturday).
When Mr Obama signs an order later on Friday, a process to cut the defence budget by 10% and other programmes by 8.5% will be set into motion.When Mr Obama signs an order later on Friday, a process to cut the defence budget by 10% and other programmes by 8.5% will be set into motion.
Millions of federal workers could face up to 22 forced days off without pay this year.Millions of federal workers could face up to 22 forced days off without pay this year.
Our correspondent says the cuts will not happen overnight - they will be spread over the next seven months and many think Congress will agree to a deal sooner rather than later.Our correspondent says the cuts will not happen overnight - they will be spread over the next seven months and many think Congress will agree to a deal sooner rather than later.
In the Senate on Thursday, a Democratic plan blocked by Republicans proposed nearly $30bn in future cuts in defence spending and a minimum tax rate on incomes exceeding $1m.In the Senate on Thursday, a Democratic plan blocked by Republicans proposed nearly $30bn in future cuts in defence spending and a minimum tax rate on incomes exceeding $1m.
Next budget battleNext budget battle
White House spokesman Jay Carney said there were "no preconditions" on what could be discussed in Friday's meeting.White House spokesman Jay Carney said there were "no preconditions" on what could be discussed in Friday's meeting.
With Republicans refusing to allow tax rises and Democrats vowing to protect cherished social programmes, Congress is just weeks away from its next budget battle.With Republicans refusing to allow tax rises and Democrats vowing to protect cherished social programmes, Congress is just weeks away from its next budget battle.
On 27 March a temporary federal budget that has kept the federal government running since 2012 is due to expire.On 27 March a temporary federal budget that has kept the federal government running since 2012 is due to expire.
Failure by Congress to enact a new stop-gap budget could see parts of the federal government shut down.Failure by Congress to enact a new stop-gap budget could see parts of the federal government shut down.
House Republicans said they would vote on a bill next week to fund the government through the end of the fiscal year, on 30 September, but keep in place some automatic cuts taking effect on Friday. House Republicans have said they will vote on a bill next week to fund the government through the end of the fiscal year, on 30 September, but keep in place some automatic cuts taking effect on Friday.
Meanwhile the International Monetary Fund (IMF) said the global economic recovery could be harmed by the automatic spending cuts.Meanwhile the International Monetary Fund (IMF) said the global economic recovery could be harmed by the automatic spending cuts.
Are you in the US? How will you be affected by the budget cuts? Send us your comments using the form below.Are you in the US? How will you be affected by the budget cuts? Send us your comments using the form below.