But Obama and Republicans are at a stalemate.
Obama has proposed some changes that would reduce spending on Social Security and Medicare, including an adjustment that would lower cost-of-living adjustments. But he has insisted on more tax revenue by closing what he says are loopholes for the rich, a step Republicans won't take.
The impasse has revived threats of a government shutdown after the current budget year ends Sept. 30 and, more economically damaging, a default if Congress can't agree to raise the debt ceiling later in October.
Some conservative Republicans say they will only extend current spending levels or increase the debt ceiling if Obama delays putting in place his health care law, a condition Obama has flatly rejected.
Speaker John Boehner (R-Ohio) has tried to keep the focus on spending reductions, even as some on his right insist on defunding or delaying the health care law.
"This year the federal government will bring in more revenue than any year in the history of our government, and yet we will still have nearly a $700 billion budget deficit," he said. "We have a spending problem. It must be addressed, period."