UPDATE 1-US administration urges Republicans not to block 'fiscal cliff' deal

Mark Felsenthal
Reuters Middle East

HONOLULU, Dec 26 (Reuters) - As President Barack Obama cut

short a Christmas vacation to resume talks to avoid the "fiscal

cliff" of automatic year-end tax hikes and spending cuts, the

White House on Wednesday called on congressional Republicans not

to stand in the way of a resolution in the U.S. Congress.

"It's up to the Senate Minority Leader not to block a vote,

and it's up the House Republican leader, the Speaker of the

House ... to allow a vote," a senior administration official

told reporters traveling with the president.

Obama is seeking a stripped down deal to prevent tax rates

from rising on all but the wealthiest Americans and to stop

steep across-the-board spending cuts.

The White House last week proposed a broader package that

would have let tax rates stay low for those making up to

$400,000, a compromise from the president's previous rate hike

threshold of $250,000.

House of Representatives Speaker John Boehner was

unimpressed with the offer and sought unsuccessfully to push his

own proposal through Congress, but members of his own Republican

Party balked at rate hikes of any kind. Talks broke down after

that and the president and lawmakers left town for the holiday.

The focus will shift to the Senate for a deal, where Obama

will rely on an ally, Senate Majority Leader Harry Reid, to work

out a bill that the top Senate Republican, Kentucky's Mitch

McConnell, will not obstruct. The House must also pass the


A broader effort to trim the nation's massive budget deficit

will have to wait, the official said.

Congressional stubbornness risks again damaging the fragile

economy, just as the nation's near-default in 2011 - the result

of a stalemate over raising the national borrowing limit - dealt

a nascent economic recovery a setback, the administration

official said.

"If you think about the possibility of Congress failing to

act to avert the fiscal cliff, combined with the abomination of

what occurred in the summer of 2011, hits to our economy aren't

coming from external factors, they're coming from congressional

stupidity," the official said.

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