Senate Leaders Seek Fiscal Deal

Also likely to be included in the negotiations are taxes on dividends and capital gains, both of which are scheduled to rise with the new year. Also the alternative minimum tax, which, if left unchanged, could hit an estimated 28 million households for the first time and mean an average increase of more than $3,000.

The White House has shown increased concern about a possible doubling of milk prices if a farm bill is not passed in the next few days, although it is not clear whether that issue too might be included in the talks.

One Republican who was briefed on the White House meeting said Boehner made it clear he would leave in place spending cuts scheduled to take effect unless alternative savings were included in any compromise to offset them. In previous White House proposals, Obama has suggested finding enough cuts in government spending to put off the steeper cuts for up to six months.

Obama, speaking to reporters following his meeting with the congressional leaders, faulted a system that left crucial decisions to the last minute, a way of governing that he said the public finds "mindboggling."

"Outside of Washington nobody understands how it is that this seems to be a repeat pattern, over and over again," he said.

Still, Obama himself is part of the negotiating process, and his meeting with all four top leaders Friday was the first since Nov. 16. A phone call he placed Wednesday night to McConnell was the first the Republican leader had received from a Democrat on the fiscal talks since Thanksgiving.

Looking to add pressure on negotiators, Obama said he expects Reid to put legislation on the floor to prevent tax increases on the middle class and extend unemployment benefits -- an implicit challenge to Republicans to dare to vote against what polls show is popular.

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