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| US talks on cutting deficit are on the verge of failure | |
| (about 6 hours later) | |
| Talks in Washington aimed at cutting the US government's borrowing are on the verge of failure. | |
| A special Congressional committee had been charged with finding $1.2tn (£762bn) in savings by Wednesday. | A special Congressional committee had been charged with finding $1.2tn (£762bn) in savings by Wednesday. |
| But the talks between Democrats and Republicans are widely reported in the US media to have collapsed, with a formal joint-statement to that effect expected later on Monday. | |
| Meanwhile, the US national debt has just risen above $15tn (£9.5tn). | Meanwhile, the US national debt has just risen above $15tn (£9.5tn). |
| The committee was set up in August, a result of a last-minute deal between the two sides in Congress to raise the debt ceiling and avert a potential default on US debt payments. | The committee was set up in August, a result of a last-minute deal between the two sides in Congress to raise the debt ceiling and avert a potential default on US debt payments. |
| Its members were instructed to find at least $1.2tn in savings or face automatic cuts in defence and domestic spending of an equivalent amount. | Its members were instructed to find at least $1.2tn in savings or face automatic cuts in defence and domestic spending of an equivalent amount. |
| Reuters reported that the Republican and Democrat heads of the 12-member committee will issue a statement later on Monday saying they have been unable to reach a deal. | Reuters reported that the Republican and Democrat heads of the 12-member committee will issue a statement later on Monday saying they have been unable to reach a deal. |
| On Friday, the committee's Republican co-chairman Jeb Hensarling told reporters that members would meet over the weekend if necessary to "try and find sufficient common ground". | On Friday, the committee's Republican co-chairman Jeb Hensarling told reporters that members would meet over the weekend if necessary to "try and find sufficient common ground". |
| Disagreements have centred on whether tax increases should form part of the budget reduction measures, with Democrats in favour of such rises but Republicans opposed. | Disagreements have centred on whether tax increases should form part of the budget reduction measures, with Democrats in favour of such rises but Republicans opposed. |
| Republicans had also demanded cuts in entitlement programmes, such as social security, medicare and medicaid - something that Democrats had shown willingness to permit, but only in return for tax rises on the rich that were not forthcoming from the other side. | Republicans had also demanded cuts in entitlement programmes, such as social security, medicare and medicaid - something that Democrats had shown willingness to permit, but only in return for tax rises on the rich that were not forthcoming from the other side. |