Spending Cuts, U.s. Economy | featured news

The U.S. economy grew at a 2.7 percent annual rate from July through September, much faster than first thought. The strength may fade in the final months of the year if Congress and the Obama administration fail to reach a budget deal.

Congressional leaders of both parties will meet with the president in an effort to reach a deal to avoid across-the-board tax increases and spending cuts that could push the economy into recession.

Amid a global fright over Washington's political brinkmanship, U.S. lawmakers return to the capital on Tuesday with a seven-week deadline to reach agreement on scheduled tax hikes and budget cuts that threaten to trigger another recession.

Flush with re-election vigor, President Barack Obama on Friday will provide his first public comments on the upcoming negotiations with Congress on how to deal with pending tax hikes and spending cuts that create the so-called fiscal cliff facing the economy at the end of the year.

Democratic leaders called on Wednesday for new spending and tax cuts to boost the sluggish U.S. economy, setting up a fresh hurdle for bipartisan efforts to head off a government debt default this summer.