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Biden’s $2 trillion spending deal in focus

US President Joe Biden has edged closer to sealing his giant domestic spending legislation, though the informal deadline appeared to slip as work continued to scale back the measure and determine how to pay for it.

Negotiations were expected to continue into the weekend, with all sides indicating on Friday just a few issues remained unsettled in the sweeping package of social services and climate change strategies.

Biden met at the White House on Friday with House Speaker Nancy Pelosi, while Senate Majority Leader Chuck Schumer joined by video call from New York, trying to shore up details.

The leaders have been working with party moderates and progressives to shrink the once-$US3.5 trillion ($A4.7 trillion), 10-year package to around $US2 trillion ($A2.7 trillion) in childcare, healthcare and clean energy programs.

Pelosi said a deal was “very possible”.

She told reporters more than 90 per cent of the package was agreed to, with the climate change components of the bill “resolved” but outstanding questions remaining on healthcare.

Vice President Kamala Harris sounded even more certain. On a visit to New York City, she said tensions often rise over final details but “I am confident, frankly – not only optimistic, but I am confident that we will reach a deal”.

No agreement was announced by Friday’s self-imposed deadline to at least agree on a basic outline.

Biden wants a deal before he leaves next week for global summits in Europe.

Sticking points appear to include proposed corporate tax hikes to help finance the plan, and an effort to lower prescription drug costs that has raised concerns from the pharmaceutical industry.

Democrats are in search of a broad compromise between the party’s progressives and moderates on the measure’s price tag, revenue sources and basic components.

White House press secretary Jen Psaki compared the work to starting social security and other major federal programs decades ago.

“Progress here is a historic package that will put in place systems and programs that have never existed in our society before,” she said.

During a CNN town hall event on Thursday, Biden expressed optimism about the process.

“It’s all about compromise,” he said. “Compromise has become a dirty word, but bipartisanship and compromise still has to be possible.”

On one issue – the taxes to pay for the package – the White House idea seemed to be making headway with a new strategy of abandoning plans for reversing Trump-era tax cuts in favour of an approach that would involve a 15 per cent corporate minimum rate, and taxing the investment income of billionaires to help finance the deal.

In the mix are at least $US500 billion in clean energy tax credits and other efforts to battle climate change, $US350 billion for childcare subsidies and free pre-kindergarten, an extension of the $US300 monthly child tax credit put in place during the COVID-19 crisis, and money for healthcare provided through the Affordable Care Act.

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