Obama back from holiday as cliff looms

US president Barack Obama cut short his holiday and returned to Washington yesterday as a senior Democrat warned that the US appeared to be heading over the year-end fiscal cliff of higher taxes and deep spending cuts.

The treasury secretary warned that the government would hit its borrowing limit on Monday.

Obama made phone calls to congressional leaders before leaving his Hawaiian holiday for Washington, the White House said.

The US appears to be headed over the fiscal cliff, warned Senate Democratic leader Harry Reid who criticised his counterpart in the House of Representatives, Speaker John Boehner, for not calling House members back to work.

He said Boehner cared more about keeping his position when the new Congress comes in on Jan 3.

Treasury secretary Timothy Geithner told Congress yesterday he would take “extraordinary measures as authorised by law” to postpone a government default. But he said uncertainty over the outcome of the fiscal cliff negotiations made it difficult to determine how much time those measures would buy.

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