Senate negotiators labored over the weekend on a last-ditch plan to avert the "fiscal cliff," struggling to resolve key differences over how many wealthy households should face higher income taxes in the new year and how to tax inherited estates.
President Obama, meanwhile, aimed to keep the pressure on Congress to act, taping an appearance for "Meet the Press" to air Sunday morning.
"What Congress needs to do, first and foremost, is to prevent taxes from going up for the vast majority of Americans," Obama said on the show.
Failing to reach a deal for funding the government will slow the economy and harm most families, he said. He has advocated a plan that would raise taxes on the wealthiest 2 percent.
"There is a basic fairness that is at stake in this whole thing that the American people understand and they listened to an entire year's debate about it. They made a clear decision about the approach they prefer, which is a balanced, responsible package.
"They rejected the notion that the economy grows best from the top down. They believe that the economy grows best from the middle class out. And at a certain point it is very important for Republicans in Congress to be willing to say, 'We understand we're not going to get 100%. We are willing to compromise in a serious way in order to solve problems'."
His appearance on the NBC News show is just his second as president.
The first came in 2009 at the height of the debate over Obama's initiative to expand health coverage for the uninsured. The fiscal-cliff measure under construction in the Senate, by contrast, is more modest, designed to fix none of the nation's biggest problems.
As the clock ticked toward a Jan. 1 deadline, the halls of the Capitol were dark and silent Saturday. The House and the Senate are shuttered until Sunday afternoon, in part to avoid distractions as the talks over averting sharp tax increases for most American taxpayers entered their final hours.
While Senate Majority Leader Harry M. Reid (D-Nev.) monitored developments by telephone, Minority Leader Mitch McConnell (R-Ky.) arrived at the Capitol shortly after noon Saturday. Asked whether he and Reid would be able to strike a deal, McConnell smiled and replied: "I hope so."
As nightfall approached, top Democratic and Republican aides continued shuttling paperwork with the latest proposals back and forth between the two leaders' offices, about 60 steps apart.
Under negotiation is a deal that would extend George W. Bush-era tax cuts for nearly all taxpayers but increase rates on top earners. It also would extend unemployment benefits set to expire in January for 2 million people and prevent about 30 million Americans from having to pay the alternative minimum tax for the first time.
McConnell left the Capitol shortly before 7 p.m, revealing few details. "We've been in discussions all day, and they continue," he said. He added, "We've been trading paper all day and talks continue into the evening."
Reid and McConnell have set a deadline of about 3 p.m. on Sunday for cinching a deal. That's when they're planning to convene caucus meetings of their respective members in separate rooms just off the Senate floor. At that point, the leaders will brief their rank and file on whether there has been significant progress and will determine whether there is enough support to press ahead with a proposal.
