Lawmakers close to deal to avoid "fiscal cliff"

WASHINGTON (AP) - President Barack Obama says a deal to avert across-the-board tax hikes and programs cuts is "within sight, but not done."

The president offered the update during a White House news briefing with a group of middle-income Americans standing with him. He said the last thing people want to hear on New Year's Eve is "another speech," but that he had to "talk about progress being made."

Obama said middle class families, businesses and the nation can't afford the kind of tax hikes that would go into effect tomorrow if there is no agreement. He called that possibility "a pressing concern on people's minds."

People aware of the talks say the potential agreement would extend tax cuts to households earning up to $450,000 but that divisions remain over spending cuts.

The president said the potential agreement would extend unemployment benefits for 2 million people. Obama said the deal would also include the extension of numerous tax credits including those for college tuition, families with children and clean energy.

Obama said he would have preferred "a grand bargain" to solve of the tax and spending problems but is hopeful Congress will approve the proposal being shaped.

Senate Minority Leader Mitch McConnell says he and the White House have agreed on preventing tax hikes that the "fiscal cliff" will trigger after midnight. And he says they are very close to an overall deal that would also prevent budget-wide spending cuts.

The Kentucky Republican did not provide any details. But he said on the Senate floor that lawmakers should pass legislation averting tax increases that would otherwise take effect at the start of New Year's Day.

(Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)

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