“Fiscal cliff” crisis heads to resolution in Congress

WASHINGTON (Reuters) – A months-long battle over the U.S. “fiscal cliff” headed to a close on Tuesday as the House of Representatives moved toward final approval of a bipartisan deal meant to prevent Washington from pushing the world’s biggest economy into recession.

The Republican-controlled House was expected to back a tax hike on the top U.S. earners shortly before midnight on Tuesday, ending weeks of high-stakes budget brinkmanship that threatened to spook consumers and throw financial markets into turmoil.

Approval of the bill would be a victory for President Barack Obama, who campaigned for re-election last November on a promise to raise taxes on the wealthiest but faced stiff opposition from congressional Republicans.

Republicans had earlier considered adding hundreds of billions of dollars in spending cuts after the bill had already passed the Senate with strong bipartisan support. That would have triggered further partisan warfare and pushed the crisis well past a self-imposed January 1 deadline.

But party leaders abandoned the effort after determining they lacked the votes.

“We’ve gone as far as we can go and I think people are ready to bring it to a conclusion,” Republican Representative Jack Kingston of Georgia said. “We fought the fight.”

Rules Committee Chairman David Dreier, a Republican, predicted the House would back the Senate bill, which also postpones for two months $ 109 billion in spending cuts on military and domestic programs set for 2013.

The bill easily cleared a procedural hurdle by a bipartisan vote of 408 to 10.

Lawmakers have struggled to find a way to head off across-the-board tax hikes and spending cuts that began to take effect at midnight, a legacy of earlier failed budget deals that is known as the fiscal cliff.

Strictly speaking, the United States went over the cliff in the first minutes of the New Year because Congress failed to produce legislation to halt $ 600 billion of tax hikes and spending cuts scheduled for this year.

TAX HIKES FOR WEALTHIEST

While many Republicans were uneasy with the tax hikes and wanted more spending cuts in the bill, they seemed to realize that the fiscal cliff would begin to damage the economy once financial markets and federal government offices returned to work on Wednesday. Opinion polls show the public would blame Republicans if a deal were to fall apart.

House Republicans had earlier considered adding $ 330 billion in spending cuts over 10 years to the Senate bill, which raises taxes on the wealthiest U.S. households by $ 620 billion over the same period.

But Senate Democrats refused to consider any changes to their bill, which passed 89 to 8 in a rare display of unity early Tuesday.

That measure, which passed the Senate at around 2 a.m., would raise income taxes on families earning more than $ 450,000 per year and limit the amount of deductions they can take to lower their tax bill.

Low temporary rates that have been in place for the past decade would be made permanent for less-affluent taxpayers, along with a range of targeted tax breaks put in place to fight the 2009 economic downturn.

However, workers would see up to $ 2,000 more taken out of their paychecks annually with the expiration of a temporary payroll tax cut.

The non-partisan Congressional Budget Office said the Senate bill would increase budget deficits by nearly $ 4 trillion over the coming 10 years, compared to the budget savings that would occur if the extreme measures of the cliff were to kick in.

But the bill would actually save $ 650 billion during that time period when measured against the tax and spending policies that were in effect on Monday, according to the Committee for a Responsible Federal Budget, an independent group that has pushed for more aggressive deficit savings.

(Additional reporting by Rachelle Younglai, Thomas Ferraro and David Lawder; Writing by Andy Sullivan; Editing by Alistair Bell and Eric Beech)

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California’s New Laws Try to Do What Congress Couldn’t

On the eve of 2013, state officials are busy readying for tens of thousands of new laws that go into effect on the first day of the year. The nation’s most populous state, California, is  serving as a laboratory for several legislative measures, embarking on a number of policy experiments that were too controversial to be implemented on the national scale.

At the top of that list is California’s cap and trade program for greenhouse gases. Starting January 1, large power plants and industrial facilities in the state will have to either lower their emissions or be forced to buy credits at auction. The credits, called allowances, make the cost of polluting more expensive. Federal cap-and-trade legislation failed in Congress in 2009.

California is also pressing ahead with its own version of the Dream Act. The Dream Act would have granted a path to citizenship for illegal immigrants under age 30 who came to the U.S. before they were 16, finished high school, and don’t have criminal records. The legislation languished in Congress for years, and was blocked by Republicans when it came to a vote in 2010. Hoping to score points with Hispanics in the run-up to the presidential election, President Obama initiated a short-term workaround in the form of a two-year waiver program for this group. On January 1, California will go further than the federal government, by allowing these young people to receive financial aid from state universities, according to the National Conference of State Legislatures.

Meanwhile, some Southern states continue to tighten immigration laws. Louisiana, Tennessee, South Carolina and Georgia will now require private employers to enroll in the federal E-Verify program, an optional online system that checks whether potential hires are eligible to work in the U.S. The laws aren’t likely to have much practical effect because the program is so easily defrauded.

California, not surprisingly, has gone in the opposite direction. Starting Jan. 1, the state will prohibit local officials from requiring employers to use E-Verify unless the federal government mandates it. Employers in California will also be hamstrung by a new consumer protection law that prohibits them from using a credit report to evaluate job candidates.

The election may be over, but a number of controversial voter ID laws will take effect on Tuesday. According to the National Conference of State Legislatures, new laws requiring voters to present photo IDs will go into effect in Kansas, Rhode Island, Tennessee and Texas. Tennessee will require election official to identify possible non-citizens who are registered to vote and require them to present proof of citizenship at the polls.

Those troubled by the idea that states are moving in opposite directions on big questions of national policy might take some comfort in that rumor that Congress plans to debate immigration reform this spring. But if the fiscal cliff fight is any indicator, the debate promises to be a long slog, and lawmakers may end up with nothing to show for it.

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Armed robbers hit Paris Apple store

PARIS (Reuters) – Armed robbers targeted an Apple Inc store in central Paris on New Year’s Eve, taking thousands of euros (dollars) worth of goods, a police official said on Tuesday.

The robbery took place at about 9 p.m. (1900 GMT) on Monday, three hours after closing time at one of Apple‘s flagship stores behind the Paris Opera which sells products ranging from iPhones and iPads to Mac computers.

The police official declined to comment on reports the thieves walked away with about 1 million euros ($ 1.32 million) of loot, saying the company was still evaluating the loss.

Christophe Crepin from the police union UNSA told reporters four masked and armed individuals forced their way into the shop and afterwards escaped in a van.

“They were well prepared. As the majority of police were busy watching the Champs Elysees (for New Year’s Eve celebrations), the robbers took advantage of this opportunity,” he said.

($ 1 = 0.7585 euros)

(Reporting By Thierry Leveque and John Irish; Editing by Michael Roddy)

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Heartwarming moments defy chill at Rose Parade

PASADENA, Calif. (AP) — A couple who became husband and wife on the “Love Float,” a surprise reunion between a returning soldier and his little boy, and a grand marshal famed globally for her chimpanzee research were among the highlights of the 124th Rose Parade on Tuesday.

The parade’s spectacular 42 floral floats brightened an otherwise cloudy New Year’s morning and boosted the spirits of a chilled crowd estimated at some 700,000 spectators lining the 5-mile route.

“The only way that you’re going to experience the Rose Parade is to be here in person,” said Los Angeles resident Gineen Alcantara-Nakama, who camped out Monday night to save front row sidewalk spots.

“Growing up, I watched it on television, but it’s not the same — the smell, the atmosphere, smelling the flowers as they come down the street. And the energy. It’s like being with family all night long.”

Spectators rose to a standing ovation when Army Sgt. First Class Eric Pazz, who was riding on the Natural Balance Pet Foods float along with other service members, got off the float and walked over to his surprised wife Miriam and 4-year-old son Eric Jr., who came running out of the stands into the arms of his 32-year-old father.

Miriam Pazz had been told she had won a contest to attend the parade and did not know her husband, who is deployed in Afghanistan, would be there. A native of Clio, Mich., Pazz is a highly decorated soldier who has also served in Iraq. The family, who currently lives in Germany, climbed aboard the float for the rest of the route.

Cheers also went up for a Chesapeake, Va., couple who tied the knot aboard Farmers Insurance “Love Float.”

Gerald Sapienza and Nicole Angelillo were high school classmates who reconnected 10 years later and won the parade wedding over three other couples in a nationwide contest. They received a trip to Pasadena, a wedding gown, tuxedo, rings, marriage license fees, Rose Bowl game tickets and hair and makeup for the bride.

The parade’s theme this year was “Oh the Places You’ll Go!” named in honor of the Dr. Seuss book. It served as a fitting slogan for grand marshal British primatologist Jane Goodall, who has spent much of her life in Tanzania studying chimpanzees.

Goodall chose conservation as her message for the parade

“My dream for this New Year’s Day is for everyone to think of the places we can all go if we work together to make our world a better place,” said Goodall, 78.

“Every journey starts with a step and I am pleased to see the Tournament of Roses continue to take steps toward not only celebrating beauty and imagination, but also a cleaner environment.”

This year’s parade also saw the first-ever float entered by the Defense Department.

The $ 247,000 military float was a replica of the Korean War Veterans Memorial in Washington to commemorate the veterans from that conflict.

The float that scooped up the parade’s grand “Sweepstakes” prize for the most beautiful floral presentation and design was “Dreaming in Paradise” by fruit and vegetable producer Dole.

According to parade rules, every inch of the floats must be covered with flowers or plant material, most of it applied by volunteers in the last weeks of December.

Besides floats, the parade also featured 23 marching bands and 21 equestrian units from around the world.

Banda El Salvador, a 200-plus member marching band and folkloric dance troupe, played sassy Latin rhythms and paid homage to their Central American country by dressing in the national colors of blue and white and shouting “Arriba El Salvador!”

The Aguiluchos band from Puebla, Mexico, earned cheers for their fancy footwork and vaquero rope tricks. Colorful dancers from Costa Rica and South Korea were other crowd pleasers.

Die-hard parade fans staked out their spots overnight or in pre-dawn hours with folding chairs, hammocks and portable barbeque grills despite frosty temperatures.

Emergency personnel received a number of cold-weather exposure calls, police department spokeswoman Lisa Derderian told City News Service.

As of 8 a.m. Tuesday, police had made a total of 22 arrests along the parade route since 6 p.m. Monday, said police Lt. Rick Aversan. All but one arrest were for suspected public intoxication. The other was for suspected possession of burglary tools that could have been used to break into cars, police said.

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Hillary Clinton, Hospitalized with a Blood Clot, Faces New Decisions

Yesterday evening Secretary of State Hillary Rodham Clinton was hospitalized for treatment and monitoring of a blood clot. Earlier this month, the 65 year old Secretary collapsed and hit her head while suffering from a stomach virus. At that point, she sustained a concussion. This may have contributed to the new problem, according to State Department notices. The location of her blood clot, in terms of what body part is affected, has not been disclosed.This is the Secretary and former First Lady’s second reported blood clot, or thrombosis. In a previous interview with the New York Daily News, Mrs. Clinton related an episode in 1998 when her foot became swollen and painful. It was a time when she was campaigning and frequently traveling on airplanes. Her doctors diagnosed a blood clot. “That is the most significant health scare I’ve ever had,” she told the Daily News in October, 2007.The most common kind of blood clot, a deep venous thrombosis, or DVT, tends to arise when flow slows down within a vein, typically in a person’s leg. Clots arise when platelets and fibrous proteins clump and stick to a vessel wall. This can be a normal, healthy response to trauma – whether that’s a nick upon shaving or surgical incision. In people disposed to DVT, the small clots don’t dissolve properly or may form in the absence of trauma. If a clot expands and propagates from below the knee, for example, to a more central position in the body, that’s called an embolism. Clots are most dangerous when and if they spread to arteries in the lungs, causing pulmonary embolism, or to vessels in the brain.The CDC estimates that between 300,000 and 600,000 individuals sustain DVTs and pulmonary embolism in the United States each year, and that between 60, 000 and 100,000 of those are events are lethal. Some people inherit a disposition to clotting that can be evaluated by blood tests. Clots are most common in people who’ve been immobilized, such as after surgery, or are bed-bound with illness. Dehydration compounds the risk. Coach class syndrome refers to the proclivity of some to develop clots upon long-distance travel in a cramped position.Other risk factors for DVT include some malignancies. Cancer, depending on its position, can impede blood flow from the lower body, promoting stasis in the leg veins, or otherwise interfere with clot-dissolving proteins. Some women with autoimmune conditions, like lupus and other syndromes, may be disposed to clotting in veins or arteries. Some medications pose a risk, too. Those include estrogen-containing oral contraceptives and hormone replacement therapy. In general, high-estrogen states dispose to pathologic blood clots. In younger women, the disposition to blood clotting can manifest during pregnancy.As far as we know, the cause of Mrs. Clinton’s blood clot is uncertain. She is in the hospital being treated with blood thinners. Usually people who have significant blood clots in a deep vein or artery take an anti-coagulant for a period of months. Until recent years, the standard treatment involved injections of heparin, or similar blood thinners, followed by Coumadin, an oral anticoagulant that requires frequent blood checks. Now, there are more options for therapy, including heparin-like agents that can be injected at home.On November 2 of this year, the FDA approved Xarelto (rivaroxaban) for treatment of deep venous thrombosis. This new drug, a pill, works by inhibiting a clotting factor called Xa. While several oral anticoagulants have received approval for prevention of clots in people undergoing surgery, and for prevention of strokes in people with disposing heart problems, Xarelto is the first in this new class of drugs that might be prescribed for treatment of DVT or pulmonary embolism.Before her recent admission to the hospital, the Secretary of State hadn’t said much about what she’ll do when she exits her official office. Popular views include that she’ll get more rest, exercise, spend time with her family, write a book and, possibly, run for President in 2016. Today, she’s presumably resting and, together with her doctors, sorting out the factors that led to her developing a significant blood clot. Good to know that she, like any other informed patient, has several treatment options to consider.Update: The U.S. State Department issued an update on Mrs. Clinton’s condition, clarifying that the Secretary of State has a blood clot in a vein near the inside of the skull, on the right side. According to their statement, she has not suffered a stroke or neurological damage. Photo: State Department’s Tumblr

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Pope marks end of difficult year, notes God’s good

VATICAN CITY (AP) — Pope Benedict XVI marked the end of a difficult year Monday by saying that despite all the death and injustice in the world, goodness prevails.

Benedict celebrated New Year’s Eve with a vespers service in St. Peter’s Basilica to give thanks for 2012 and look ahead to 2013. He appeared tired during the service and used a cane afterward — an indication that the busy Christmas season may be taking a toll on the 85-year-old Benedict.

In his homily, Benedict said it’s tough to remember that goodness prevails when bad news — death, violence and injustice — “makes more noise than good.” He said taking time to meditate in prolonged reflection and prayer can help “find healing from the inevitable wounds of daily life.”

This past year was full of highs and lows for the pope, including a successful trip to Mexico and Cuba but also the betrayal of his butler, convicted in October of stealing Benedict’s personal papers and leaking them to a journalist.

After the service, Benedict was brought out in a covered car to pray before the Vatican’s main nativity scene in St. Peter’s Square. Walking with a cane in the chilly piazza, Benedict chatted animatedly with the artist who crafted the scene, which recreated an entire village from the poor, southern Italian region of Basilicata which donated this year’s crèche.

The Vatican gladly accepted Basilicata’s donation after the €550,000 price tag the Vatican paid for the 2009 nativity scene was revealed in the documentation leaked by Benedict’s ex-butler Paolo Gabriele.

Gabriele was convicted of aggravated theft by a Vatican tribunal and sentenced to 18 months in prison. He received a pre-Christmas papal pardon and is expected to soon leave his Vatican City apartment for a new home and job elsewhere.

On Tuesday morning, Benedict celebrates a New Year’s Day Mass, which the Catholic Church celebrates as its world day of peace.

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Movers roundup: Facebook, Best Buy

Among the stock activity stories for Monday, Dec. 31, from AP Business News:

— Shares of Facebook Inc. rose after an analyst said advertising spending was picking up on the Internet social network and raised his rating on its stock.

— Shares of Best Buy Co. rose on light volume as the struggling electronics retailer closed out a rocky year.

— Shares of Duff & Phelps Corp. rose on news that the company had agreed to be acquired.

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Is Tom Cruise still a go-to action hero? Hollywood, “Jack Reacher” say yes

LOS ANGELES (TheWrap.com) – Given his age and the tough year he’s had in the tabloids, is Tom Cruise still a go-to guy when Hollywood is looking for an action hero?

The answer is yes, based on the performance of his current movie, Paramount‘s “Jack Reacher.” It’s taken in $ 45 million in the 10 days since opening with $ 15.6 million in a very crowded and competitive holiday market. Its second week was a solid $ 14 million, and it’s added $ 22 million from overseas.

Holiday movies tend to have legs and “Reacher” has yet to roll out in the majority of major foreign territories, so both of those numbers, particularly the international, will be growing. All signs point to it surpassing $ 200 million at the worldwide box office. That’s not a blockbuster figure, and Paramount is staying mum on a sequel, but with a $ 60 million budget, “Jack Reacher” will make money for Paramount.

There were questions coming in. With his divorce from Katie Holmes and subsequent custody battle, Cruise is carrying plenty of public relations baggage. His foray earlier this year into musicals with “Rock of Ages” was critically applauded but proved a box-office dud. That’s on top of his well-known support for Scientology.

He’s 50 now, which might be the new 40 in the real world, but is starting to get on in years in the realm of action heroes. Daniel Craig is 44. Jeremy Renner is 41. We are a long way from “Top Gun” – that was 1986 – so it probably won’t be too, too long until “The Expendables” franchise comes calling for Cruise.

But in the meantime, “Reacher” is going to be profitable for Paramount and Cruise’s portrayal of the tough, ex-military drifter has drawn critical kudos, so there’s a bit of momentum now. And it’s clear from his upcoming schedule that Hollywood is still convinced he can carry an action film.

Next for Cruise will be two sci-fi movies: Universal’s “Oblivion” is due in April and “All You Need is Kill” is set for March 2014 from Warner Bros. After that, there’s a potential “Van Helsing” remake at Universal and “Mission: Impossible 5″ is on Paramount‘s 2015 slate.

His recent track record at the box office, particularly when you look at his performance in the action genre, suggests the studios are making a pretty good bet.

“Rock of Ages” may have crumpled, but “Mission: Impossible – Ghost Protocol” was a huge hit for Paramount, taking in nearly $ 700 million worldwide in 2011. “Knight & Day,” from Fox in 2010, and “Valkyrie,” from United Artists in 2008, both made over $ 200 million worldwide.

Supporting roles in “Tropic Thunder” and “Lions for Lambs” preceded those, but those came on the heels of two Paramount movies: “Mission Impossible 3,” which made nearly $ 400 million worldwide in 2006, and “War of the Worlds,” which did $ 592 million in the previous year.

The bottom line: Hollywood is still convinced you can still take Tom Cruise, movie action hero, to the bank.

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New Year’s Resolutions For Better Health

New Year’s resolutions are typically so singular, self-focused and private. How about making a resolution or two this year that has benefits beyond yourself? Here are some suggestions with lots of links to get you started.

You can help stop the spread of disease. Resolve to get up-to-date on your vaccines. While children have a full slate of vaccines, many adults don’t realize they have regular immunization obligations, too. Getting flu, pertussis, human papillomavirus and other vaccines can protect you and help stop the spread of diseases that harm others. Here’s a great guide to adult immunizations from the federal government. If the cost of vaccines is an issue, check into free or low-cost immunizations through your county’s public health department. Here’s a guide to finding your local office. Volunteer with an organization that needs your help. A group called Catchafire matches professionals who wish to volunteer their skills to organizations that need the help — including many important health organizations. The idea is to give great organizations access to top talent while respecting the professionals’ schedules and making their volunteer work meaningful. Here’s the link. Influence a healthier food climate. Americans spend about half of their food budgets eating out. So we had better demand thorough nutritional information about what we’re getting. Under healthcare reform, many restaurant chains will soon carry nutritional information. But the law has loopholes. If you don’t see the information you’re looking for on salt, fat, calories or other nutrients, ask the restaurant’s manager where you can find it. Nutritional information should be easy to access. Until it is, speak up and ask for it. Do your part to keep down healthcare costs. The Affordable Care Act will bring many consumers into the insurance healthcare system for the first time. But that doesn’t mean we can ignore the cost of care. Rising healthcare costs remain a huge issue that could drag down the economy and bedevil some reform efforts. You can help by being a wise healthcare consumer. Read your insurance policy and know what it does and doesn’t cover. Take advantage of free preventive care services and screening tests under the ACA. Shop around for prescriptions to find the cheapest prices. Ask your doctor for generic equivalents. Finally, use your health savings account if your employer offers one. These accounts provide incentives for using your money wisely, shopping around to find the best healthcare prices and weighing the costs and benefits of certain drugs, tests or procedures.  Here’s a guide to understanding how HSAs work. Be responsible about the prescription drugs you store at home. You can reduce your own risk of addiction and lower the risk for others, too, if you are careful about medications kept in your home. This year marked a turning point in the nation’s epidemic of prescription-drug abuse and addiction.  Admissions to addiction treatment centers for use of narcotic painkillers rose 569 percent in the past decade, according to the federal government. More people now die from drug overdoses than from traffic accidents. More than six million Americans abuse prescription drugs, and more than 70 percent of addicts get their drugs through family or friends or by raiding a home medicine cabinet. Dispose of unused medications. The Drug Enforcement Agency operates a National Prescription Drug Take-Back Day a few times a year (the next one is in April), that makes it easy to dispose of dangerous substance.  Go through your home today and collect unused medications. You can take them to a pharmacy for disposal or even flush them down the toilet. Some drugs carry disposal instructions on the label. Here’s information on how to dispose of prescription medications. Be a safe driver. One of the biggest safety issues on the nation’s roads these days is driver distraction. A large share of the distractions come from talking on a hand-held cell phone or text messaging while driving. You’re 23 times more likely to crash if you text while driving. Most states now prohibit texting while driving, but there are still many people who do it while knowing it’s unsafe. Break yourself of this terrible habit. The federal government has a website that provides people with information and tools to discourage distracted driving. Included in this package is a simple pledge sheet you can print out, sign and post on your refrigerator door or bathroom to help you make the commitment. There are a couple of other things you can do, too. Speak out if the driver you’re riding with is distracted. Encourage family and friends to drive phone-free. Run a race for the greater good. Who doesn’t love a good 5K walk or run? You benefit from the exercise and, if you choose a charity race, others reap rewards, too. There are thousands of charity races each year. Pick one and invite your friends to participate with you. Here’s a website to help you find a race.  Apply for a grant. There’s money out there for doing good. Saucony’s Run for Good Foundation aims at preventing child obesity by promoting running as part of a healthy lifestyle for kids. The foundation issues grant money to organizations that want to organize a kids’ running group. You can find information on how to apply at the foundation website. Sign a petition. Concerned about flame retardants in consumer products? Gun safety? Funding for research to fight a particular disease? There’s probably a petition for that. It’s an easy way to make your voice heard. Both change.org and thepetitionsite.com are good places to look to find a petition close to your heart.

Question: What resolutions can you make to help others? Tell us what you think in the comments.

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Shari Roan is an award-winning health writer based in Southern California. She is the author of three books on health and science subjects.

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Washington pushes United States to edge of “fiscal cliff”

WASHINGTON (Reuters) – Lawmakers pushed the country to the edge of the “fiscal cliff” on Sunday as they struggled to reach a last-minute deal that could protect the world’s largest economy from a politically induced recession.

Democratic and Republican leaders in the Senate had hoped to clear the way for swift action that would avert sweeping tax increases and spending cuts due to kick in on Tuesday.

But with the two sides still at loggerheads in talks, Senate Democratic leader Harry Reid postponed any possible votes and the Senate adjourned until Monday, leaving mere hours to pass any deal that may emerge through both chambers of a bitterly divided Congress.

“There are still significant differences between the two sides,” Reid said on the Senate floor.

Behind closed doors, the parties kept seeking a way to bridge deep divides over taxes and spending. But even if a deal emerges in the coming hours, under Senate rules any one of the 100 senators could prevent the chamber from acting quickly.

Prospects are also uncertain in the House of Representatives, where dozens of conservative Republicans could oppose any deal that includes a tax increase on the nation’s wealthiest households.

As the hours ticked away, it appeared increasingly likely that Washington’s failure to act would deliver a $ 600 billion hammer blow to the fragile U.S. economic recovery.

“Something has gone terribly wrong when the biggest threat to the American economy is the American Congress,” said Democratic Senator Joe Manchin of West Virginia.

Americans could see a bigger bite taken out of their paychecks starting on Tuesday as payroll and income tax cuts expire, while 2 million unemployed Americans could see their jobless benefits run out. Government contractors might be forced to lay off employees as $ 109 billion in automatic spending cuts kick in, and businesses could lose tax breaks for everything from wind power to research and development.

The uncertainty has weighed on financial markets and forced businesses to slow hiring and investment. Market participants braced for more turbulence on Monday.

“I believe investors will show their displeasure tomorrow by selling stocks if there is no deal,” said Mohannad Aama, managing director at Beam Capital Management in New York.

Though corporate chieftains have lobbied lawmakers to show flexibility, Congress also faces pressure from an array of interest groups urging them not to compromise core principles.

Conservative groups have warned Republicans that a vote to increase any taxes could be held against them, while liberal and labor groups have pressed Democrats to resist any benefit cuts to popular retirement and health programs.

Lawmakers may find it easier to act once the country goes over the “fiscal cliff” on January 1, as any new legislation can then be portrayed as a tax cut rather than a tax increase.

POINTS OF DISAGREEMENT

Republicans floated a proposal on Sunday to slow the growth of Social Security retirement benefits by changing the way they are measured against inflation, but they backed away after Democrats said they would not consider it.

Still, there were disagreements over all the major aspects of the negotiation.

Buoyed by his re-election in November, Obama has insisted that any deal must include a tax increase on the wealthiest Americans, who have seen their earnings rise steadily over the past decade at a time when income for the less affluent has stalled.

Many conservative Republicans in the House of Representatives oppose a tax hike on anyone, no matter how wealthy.

Obama has proposed raising income taxes on households that earn more than $ 250,000, but Republicans pushed to set the threshold between $ 400,000 and $ 500,000. Republicans also were resisting a Democratic proposal to raise inheritance taxes on the wealthiest estates.

Republicans were looking for new reductions to replace the looming spending cuts, which would fall equally on military and domestic social programs. Democrats say the increased taxes on the wealthy would generate enough revenue to offset those cuts.

Senate Republican leader Mitch McConnell talked several times to Vice President Joe Biden by phone in the hope of breaking the stalemate.

“I’m willing to get this done, but I need a dance partner,” McConnell said.

In a rare appearance on NBC’s “Meet the Press,” Obama accused Republicans of rejecting significant compromises several times already. He said he would try to reverse the tax hikes for most Americans if Congress fails to act.

“If people start seeing that on January 1st this problem still hasn’t been solved … then obviously that’s going to have an adverse reaction in the markets,” he said.

House Speaker John Boehner rejected Obama’s accusations that his fellow Republicans were not being amenable to compromise.

“The president’s comments today are ironic, as a recurring theme of our negotiations was his unwillingness to agree to anything that would require him to stand up to his own party,” he said in a statement.

(Additional reporting by David Gaffen, Thomas Ferraro, Rachelle Younglai, Jeff Mason and Emily Stephenson; Writing by Andy Sullivan; Editing by Alistair Bell and Christopher Wilson)

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