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Obama agenda: Tough talk

“President Obama pressured Republicans on Wednesday to accept higher taxes as part of any plan to pare down the federal deficit, bluntly telling lawmakers that they “need to do their job” and strike a deal before the United States risks defaulting on its debt,” the New York Times says.

The Atlantic's Josh Green writes in the Boston Globe: “One reason why the debt showdown isn’t causing more alarm is that interest rates have been falling. But that’s due mostly to declining economic forecasts in the United States and fear of a Greek default — currently more powerful influences, but also ones that would mask worries about a US default.”

“At some point, perhaps as soon as in a few weeks, the fight in Congress could eclipse those factors and drive interest rates higher. That’s been the historical pattern, and it is already causing worry about what might trigger such a rise. ‘The nervousness on our end is that the markets will misperceive what’s going on,’ an aide to a conservative House Republican told me. ‘If something fails on the House floor, people might react as if all life is about to end — just like they did when the TARP vote failed.’”

The Boston Globe’s Johnson says that Michelle Obama is raising money from people who were big Clinton supporters.