Obama: Still differences on debt, new talks Sunday (AP)

WASHINGTON – with a deadline of August for a budget agreement to lift the nation's debt ceiling looming, President Barack Obama and Congressional negotiators are trying to close some loopholes and cutting programs popular social benefit as they work to reach an agreement between Republicans and Democrats.

With both sides still far apart, Obama has called everyone back at the White House for a meeting on Sunday.

The President met with the eight Senior Republican and Democratic Congressional leaders for an hour and a half on Thursday, hoping to fill the ideas held by both sides — each considered untenable by others. On Capitol Hill, Democrats appeared particularly rattled that discussions included proposals to cut spending for social security and Medicare and Medicaid.

House Democratic leader Nancy Pelosi opposes cutting benefit programs and will have the opportunity to raise his concerns when he meets Friday with the President.

"We are not to balance the budget on the backs of the elderly in America," said Pelosi.

After you have dragged on for weeks, the top-level talks have entered a suspense finale. The form of an agreement remains in doubt as the nation moves closer to a deadline 2 August to increase the Government's debt ceiling.

Obama pushed for an ambitious deficit reduction of about 4 billion dollars, the largest of the three options that laid on the table. It would require substantial tax revenue that many Republicans oppose and spending reductions for programs in law, opposed by many Democrats. But the idea of a deal potentially historical has been well received by participants in the meeting, officials said later, though the details remained in dispute.

After the 90-minute session Thursday, Obama said Democrats and Republicans should be prepared to display their bottom-line demands when they return to the negotiating table Sunday.

At stake is negotiating. Without an agreement on reducing the deficit, Republican leaders say they have enough GOP votes to increase the authority of the country, raising the danger of the first ever U.S. default on its debts when the current debt ceiling 14.3 billion is tapped out.

"Everyone has recognised that we need to get this done before the end of August 2 to make sure that America is not the default for the first time on its obligations," said Obama. "And everyone has recognised that there is going to be politically involved on all sides of pain".

That leaves little time to agree reductions of 2 billion to $ 4 trillion deficit by 10 years.

The most important centers on how to reduce spending on major programs as Medicare, Medicaid law and social security, all praised by Democrats on fiscal changes and to close loopholes and finish some business breaks. Republicans insist that changes be used to lower tax rates on businesses and individuals; Obama also wants them to generate more tax revenue.

Increasing the debt ceiling through the end of 2012 — a date favored by the White House — would require authorizing approximately 2.4 billion in additional loans. House Speaker John Boehner insisted on a reduction of the deficit to 10 years, as a minimum, match the additional loan amount. An aide to a legislature at its meeting of Thursday, said Obama made it clear that he would not sign an agreement on the budget and debt that does not extend the debt ceiling until after the presidential elections of November 2012.

During the meeting, Obama said the leaders who have faced three options — a deficit reduction plan, a plan that will reduce deficits average from 2 billion in 10 years or a great deal that would shoot for up to 4 billion dollars in deficit reduction over the coming decade. Obama stated that he preferred the most.

During the meeting, Boehner and Senate Minority Leader Mitch McConnell of Kentucky supported goal of larger, more ambitious than Obama, said Democratic officials familiar with the talks. Their lieutenants, Senate GOP Whip Jon Kyl of Arizona and House Majority Leader Eric Cantor of Virginia, indicated that they believed that the medium-sized option was more realistic. Cantor and Kyl had participated in the talks, led by Vice President Joe Biden who had already identified about 2 billion dollars in deficit reduction.

The negotiations are politically difficult for both parties.

Raise the roof of the debt is unpopular with voters, especially those who vote Republican, growing concern among GOP lawmakers that they could be challenged by fellow Republicans in primaries across the country.

Large law programs as social security, Medicare and Medicaid long are protected from congressional Democrats.

Underlining the political stakes, the Pew Research Center reported Thursday that in a recent poll found that six in 10 respondents believe it is more important to preserve social security and Medicare benefits than reducing the budget deficit.

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Associated press writers Ben Feller, Andrew Taylor, Alan Fram, Ricardo Alonso-Zaldivar and Laurie Kellman contributed to this report.

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