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Summary
31 December 2012
US Congressional leaders have one more day of negotiations2 to stop steep tax rises and spending cuts, known as the 'fiscal cliff', after talks ended with no deal.
Reporter:
Andrew Walker
Report
The big concern about the standoff in Washington is that the economy could go back into recession if the tax increases and spending cuts go through. Any damage could be moderated if the measures are partly reversed in the next few months, but there are reports suggesting that there has already been some impact on business investment and jobs.
Some differences between President Obama and the Republicans in Congress have narrowed, on income taxes, for example. But they are not resolved and there remain major divergences3 over how to stabilise the US government finances.
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