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US Senate reaches deal on debt ceiling
Republican and Democratic leaders in the Senate have agreed on a deal to raise the US debt ceiling, to $17trillion.
Under the plan announced by President Barrack Obama, the nation's debt limit would rise in two steps by about $US2.4 trillion ($A2.19 trillion) and spending would be cut by a slightly larger amount, the officials said. The first stage - about $US1 trillion ($A911.24 billion) - would take place immediately and the second later in the year.
In return, Democrats promised massive cuts in public spending, which Mr Obama said would bring the US back to "the lowest level of domestic spending since Dwight Eisenhower was president" in the 1950s.
"Is this the deal I would have preferred? No," the president admitted.
The deal involves no tax rises on any income bracket, another key Republican demand.
An initial $1trillion of spending cuts would not affect Medicare, Medicaid or social security but would "trim decades of spending" off thousands of other government programmes including the Park Service, the Internal Revenue Service and the Labour Department.
A congressional committee would then be appointed to find another $1.8 trillion in cuts "targeting Medicare, Medicaid and social security."
The cuts would be made over 10 years.
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