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Obama leads late-night budget talks

WASHINGTON – President Barack Obama held crunch late-night talks with Washington‘s top Republican seeking a deal to break a budget impasse threatening to shutter swathes of the US government.

Obama earlier told Republicans to “quit playing games” while they accused him of lacking leadership, as a Friday deadline loomed to avert a government shutdown that would halt soldiers’ paychecks and close US national parks.

The president returned from New York and went into high-stakes Oval Office talks with John Boehner, the Republican Speaker of the House of Representatives and his fellow Democrat Harry Reid, who leads the Senate.

Obama‘s spokesman Jay Carney said the president had been told by Boehner in a short telephone call earlier in the day that there had been some progress in talks with Senate Democrats on a deal to fund the government until October 1.

“He has now decided that not enough progress is being made,” Carney said.

Earlier, Obama had warned of the dire impact of a government shutdown on the slow US economic recovery, as the two sides feuded over Republican demands for huge spending cuts and Democratic red lines on education and other programs.

“I do not want to see Washington politics stand in the way of America‘s progress,” Obama said in Pennsylvania, warning of the impact of a government shutdown that could see around 800,000 federal workers temporarily laid off.

“At a time when you’re struggling to pay your bills and meet your responsibilities, the least we can do is meet our responsibilities to produce a budget.

“That’s not too much to ask for. That’s what the American people expect of us. That’s what they deserve. You want everybody to act like adults, quit playing games, realize it is not just my way or the highway.”

Boehner sharpened his tone after a meeting of the Republican House caucus that included conservative budget hawks demanding huge spending cuts from party leaders who must eventually find a way to make a deal with Senate Democrats on a budget.

“I like the president personally, but a president needs to lead — he didn’t lead on last year’s budget, and he clearly isn’t leading on this year’s budget,” Boehner said.

Republican leaders appeared angered by the tone of an appearance by Obama in Pennsylvania, ostensibly devoted to renewable energy, in which the president also weighed in on the budget wrangle on Capitol Hill.

Obama said a shutdown could halt approvals of home loans backed by the government, shut off small business grants and close national parks.

Aides said the shutdown would stop paychecks for troops abroad, though they would eventually get paid in full once a shutdown was over.

Paper tax refunds would be delayed, but electronic filing and rebates would continue to operate. US national parks and Smithsonian Institution museums in Washington would also be shut.

Washington would meanwhile lose its annual cherry blossom festival, a hit with tourists.

However, many government operations, including US military mission overseas would continue and the Department of Homeland Security functions would go on as they are deemed vital to national security, a senior official said.

The showdown on the budget for the 2011 fiscal year through October 1 is the most serious confrontation yet between Obama, who has already launched his 2012 reelection bid, and Republicans who seized power in the House last year.

Many new Republican lawmakers campaigned on a platform of slashing government in the name of cutting a deficit predicted to hit 1.5 trillion dollars this year, according to Congressional Budget Office estimates.

Obama says he is ready to make a deal on cuts, but has warned he will not stand for cuts that starve crucial spending on issues like education and energy development that he believes are crucial to America‘s future, and on some medical procedures.

Democrats complained Wednesday that Boehner had broken an agreement in principle to cut $33 billion and was now seeking $40 billion, while the speaker’s office denied there had ever been a deal on the first figure.

“Every time we agree to meet in the middle, they move where the middle is,” said Reid, and painted Boehner as hostage to ultra conservatives in his own party.

“The speaker has a choice to make, and not much time to make it. He can either do what the Tea Party wants or what the country needs.”

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