Seventy-two hours after winning a second term, President Barack Obama returned to the nation's capital once again in political gridlock, saying now is the time to work together to avoid the looming "fiscal cliff."
During a brief statement to the American people Friday, Obama said he is committed to working with Congress to solve the country's fiscal challenges.
Democrats and Republicans are drawing battle lines on how best to reduce the national debt and avoid the potential crisis. The approaching "cliff" hits Jan. 1 when a mix of tax hikes and spending cuts that would cut the deficit by $503 billion through next September kicks in.
The president said he is "willing to compromise" but will refuse to accept any approach that "isn't balanced."
"We can't just cut our way to prosperity if we're serious," he said.
CBN News Congressional Correspondent John Jessup has more from Capitol Hill, following this report.
On Friday, Republican House Speaker John Boehner reaffirmed his position that raising taxes was not the answer. At the Capitol, Boehner said he remains unwilling to raise tax rates on upper-income earners.
"Twenty-four hours after I spoke, the Congressional Budget Office released a report showing that the most harmful consequences of the fiscal cliff come from increasing tax rates," he said.
An aide for House Ways and Means Committee Chairman Dave Camp, R-Mich., said, "Job creators agree and have made it clear that raising taxes will result in a weaker economy and fewer jobs for the millions of Americans struggling to find work."
But Democrats insist they have a mandate from voters to raise taxes on the wealthy.
"There was a message sent to us by the American people based on the campaign,and that is people making all this money have to contribute a little bit more," Senate Majority Leader Harry Reid said.
Exit polls show the economy was the top issue for six out of 10 voters Tuesday. A lot is at stake and time is tight.
Bush-era tax cuts are set to expire at the end of 2012 along with deep cuts in defense and domestic spending.
Unless a deal is struck, every American taxpayer will see a substantial increase in their taxes starting Jan. 1. Experts say that could barrel the economy back into recession and cost millions of jobs.
To avoid the fiscal cliff Republicans are proposing a one-year extension of all Bush-era tax cuts and say they'd be open to new tax revenues but only under the right conditions.
"It's clear that there are lots of special interest loopholes in the tax code, both corporate and personal," Boehner said. "It is also clear that there are all kinds of deductions some of which makes sense, other's don't."
Meanwhile, US and global stock markets took a beating this week as investors continue to worry about Washington's ability to find a solution to the fiscal cliff.