Obama rejects short-term debt deal, urges compromise

Washington (CNN) - President Barack Obama ruled out any possibility of signing a short-term extension of the federal debt ceiling Monday, insisting that the time has come to tackle the nation's most pressing fiscal problems in a comprehensive way requiring bipartisan compromise on both taxes and cuts to entitlement programs.

The president continued to push for the largest deal possible - an apparent rejection of a call by House Speaker John Boehner, R-Ohio, to focus more narrowly on spending cuts agreed to in an earlier round of negotiations.

It's time to "pull off the Band-Aid" and "eat our peas," Obama told reporters of the need for both sides to make difficult choices to address the nation's mounting federal deficits and debt. "Let's step up. Let's do it."

Noting that Republicans have pushed for decisive action on debt reduction, Obama urged them to compromise from their blanket refusal to end Bush-era tax cuts for wealthy Americans. The president said he'd be willing to push Democrats to do something they don't like - reform Medicare and other entitlement programs that are the party's political legacy - in an effort to reach his goal of trimming the deficit by $4 trillion over the next 10-12 years.

"Now is the time to deal with these issues," Obama declared. "If not now, when?"

There was no breakthrough during a White House meeting between Obama and congressional leaders Monday afternoon, but top Democrats and Republicans agreed to meet again Tuesday, according to a congressional aide. Senate Minority Leader Mitch McConnell, R-Kentucky, called Monday's meeting "constructive."

While dismissing a possible short-term deal covering the rest of the year, the president insisted that an agreement to increase the current $14.3 trillion debt ceiling will be reached before August 2. Treasury officials have warned that a partial default could be triggered if lawmakers fail to act by that date.

Such a failure could lead to skyrocketing interest rates and a plummeting dollar, among other things.

Obama, who promised daily meetings until a deal is reached, reiterated his warning against either party taking a "maximalist position" in the ongoing negotiations. The president insisted he is willing to take "significant heat" from his own party on issues such as entitlement reform in order to get a deal done.

Republican leaders should as well, he said, referencing GOP opposition to any increase in tax rates.

For his part, Boehner said he still has a sharp disagreement with the White House over taxes and the "extent of the entitlement problem, and what is necessary to solve it."

"It takes two to tango, and they're not there yet," Boehner said in reference to the administration.

A Republican aide with knowledge of Monday's meeting said it included one exchange in which Boehner argued that his side also would find it difficult to vote to reform entitlements, which would likely include delaying or reducing some benefits in order to cut costs.

When Obama pointed out that the Republican-controlled U.S. House had already passed a proposal that would overhaul the government-run Medicare health insurance program for senior citizens, the GOP aide said, Boehner responded: "Excuse us for trying to lead."

Two Democratic officials with knowledge of Monday's talks confirmed the exchange but noted that it wasn't tense or any kind of showdown between Obama and Boehner.