President Barack Obama has said he is prepared to make “tough decisions” if Republicans show him a plan to prevent the US from defaulting on its debts.
The president said continued Republican opposition to any tax increases was impractical.
On Thursday a fifth consecutive day of cross-party talks at the White House between Mr Obama and congressional leaders failed to make a breakthrough.
The US must raise its $14.3tn (£8.9tn) debt ceiling to borrow beyond 2 August.
Failure to reach a deal would rattle a world economy still trying to put the 2008 downturn behind it, analysts say.
“If they [Republicans] show me a serious plan, I’m ready to move even if it requires some tough decisions on my part,” the president said during a news conference at the White House.
“I am confident that we can not only impress the financial markets, we can also impress the American people that this town can actually get something done once in a while,” he added.
But the president warned the country is “obviously running out of time”.
“So what I have said to members of Congress is that you need over the next 24 to 36 hours to give me some sense of what your plan is to get the debt ceiling raised,” he said.
President Obama said Republicans have a “unique opportunity to do something big” and stabilise the economy for decades to come, adding that a failure to raise the debt ceiling would mean “effectively a tax increase for everybody”.
On Thursday, Standard & Poor’s became the second of the major credit rating agencies to place US debt under review, citing an increasing risk of a payment default.
Another ratings agency, Moody’s, warned a day earlier that it might cut Washington’s triple-A debt rating.
President Obama said that if congressional leaders could not “find agreement on the path forward” in the next 24-36 hours, the negotiations would have to continue into the weekend, according to Democratic and Republican aides.
The political impasse boiled over on Thursday to the Senate floor, where Majority Leader Harry Reid, a Democrat, called House Republican Leader Eric Cantor “childish”.
Mr Reid said Mr Cantor “has shown he shouldn’t even be at the table” in the debt talks at the White House.
Mr Cantor reportedly told President Obama during Wednesday evening’s negotiations that the tax rises sought by Democrats simply were not going to happen.
He is also said to have urged the president to accept a short-term deal instead of a budget that would carry through to the presidential election in November 2012.
That is said to have prompted Mr Obama to say: “Enough is enough… I’ll see you all tomorrow,” before leaving the room.
US Federal Reserve chairman chief Ben Bernanke warned a Senate panel on Wednesday that a default would cause a “major crisis”, adding it would be a “self-inflicted wound”.
President Obama needs the Republican-led House of Representatives and Democratic-held Senate to agree a deal to trim the US deficit, and allow Washington to borrow beyond the 2 August deadline.
He has said he is willing to countenance cuts to social safety-net programmes dear to Democrats if certain tax breaks are eliminated.
Republicans have rejected the latter proposal, saying that would stifle investment and job growth.
“House Speaker John A. Boehner abandoned efforts Saturday night to cut a far-reaching debt-reduction deal, telling President Obama that a more modest package offers the only politically realistic path to avoiding a default on the mounting national debt.
On the eve of a critical White House summit on the debt issue, Boehner (R-Ohio) told Obama that their plan to “go big,” in the speaker’s words, and forge a compromise that would save more than $4 trillion over the next decade, was crumbling under Obama’s insistence on significant new tax revenue.”
“The sweeping deal Obama and Boehner had been discussing would have required both parties to take a bold leap into the political abyss. Democrats were demanding more than $800 billion in new tax revenue, causing heartburn among the hard-line fiscal conservatives who dominate the House Republican caucus. Republicans, meanwhile, were demanding sharp cuts to Medicare and Social Security, popular safety net programs that congressional Democrats have vowed to protect.
Obama, at least, was willing to make that leap and had put significant reductions to entitlement programs on the table. But on Saturday, Boehner blinked: Republican aides said he could not, in the end, reach agreement with the White House on a strategy to permit the Bush-era tax cuts for the nation’s wealthiest households to expire next year, as lawmakers undertook a thorough rewrite of the tax code.”
Did we just miss what happened in Minnesota? It’s not a compromise if one side gives and gives and the other side just takes. If Democrats are willing to make historic cuts to satisfy Republicans, why are Republicans then not willing to accept tax increases for the wealthiest Americans to satisfy Democrats? I am sorry, but I cannot believe that John Boehner is interested in debt reduction when he has the opportunity to save $4 trillion over the next 10 years, and because the Democrats want to compromise and include tax hikes for the wealthiest Americans, he completely scraps these cuts and goes for saving $2.4 trillion instead. It is clear, Mr. Boehner, that you do not have the best interest of the American people in mind. Once again, those with the most money hold the most influence.
Read the entirety of the article here on the New York Times.