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| U.S. President Barack Obama signs 'fiscal cliff' deal |
Washington: U.S. President Barack Obama has signed a bill that raises
taxes on wealthier Americans and preserves tax breaks for the middle class,
while delaying billions of dollars in mandated spending cuts.
The president signed the measure late Wednesday, a day after
members of Congress passed the compromise legislation to avert the so-called
"fiscal cliff."
Obama said late Tuesday, after the bill cleared Congress,
that it was "one step" in a broader effort to strengthen the American
economy.
"Today's agreement enshrines, I think, a principle into
law that will remain in place as long as I am president: The deficit needs to
be reduced in a way that's balanced.
Everyone pays their fair share.
Everyone does their part," he said. "That's how our economy
works best. That's how we grow."
The International Monetary Fund says the plan did not go far
enough to address the country's long-term economic problems, including its
deficit and overall debt.
In a statement Wednesday afternoon, IMF spokesman Gerry Rice
said more remains to be done to put U.S. public finances back on a sustainable
path without harming what it said was the still fragile recovery.
President Obama and congressional Republicans have sparred
for more than a year over tax rates, the extent of government spending, chronic
budget deficits and the country's mounting debt.
Congressional leaders described Tuesday's deal as imperfect,
but in the best interest of the American people.
Under the plan, taxes will increase for individuals making
more than $400,000 a year and couples earning more than $450,000, the first
U.S. income tax increase in 20 years. The package will also extend unemployment
benefits for a year and boost taxes on large inheritances.
The compromise delays mandated cuts to defense spending and
domestic programs for two months, setting up a future battle between the
parties. Analysts have said that without a compromise, the $500 billion in
austerity measures could eventually plunge the U.S. economy into another
recession.
Even as U.S. leaders wrangled over the tax and spending
issues, they soon face a decision on whether to increase the country's
borrowing limit, which hit its current $16.4 trillion cap on Monday. Officials say the country will be able to pay
its bills for another two months, but by then will need to increase the debt
ceiling, an action likely to spark another extended debate over Washington's
spending priorities.
President Obama said Tuesday he will not engage Congress in
a debate about whether they should raise the debt ceiling to pay for the cost
of the legislation they have already passed.