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Country on the verge of a recession if Congress and the White House don't act

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NILES, Ohio - Congress and the White House have less than two months to reach some type of compromise to avoid a possible recession.

If no agreement is reached, the government could fall from what's being called a "fiscal cliff."

The deadline is January 1st. That's when automatic tax hikes and severe budget cuts are set to go into effect.

An analysis by the Congressional Budget Office says failure to meet that deadline would trigger a recession and a spike in unemployment.

With the election over, all eyes will be focused on avoiding a fiscal plunge.

This is an issue that will impact everyone from individuals to small businesses and it's an opportunity for lawmakers to demonstrate the cooperation they've been talking about and end the grid lock in Washington.

On Friday in the East Room of the White House, President Obama said he has a detailed plan to avoid the fiscal cliff, but made it clear that it's not a case of his way or no way.

"I'm open to compromise, I'm open to new ideas," the President said.

But the President did say, "We can't just cut our way to prosperity and place the bulk of the burden on the middle class. I refuse to accept any approach that isn't balanced."

Eric Planey with the Youngstown-Warren Regional Chamber of Commerce says reaching an accord on reducing the deficit is a major challenge.

"If nothing is done and the automatics take place we're talking about a 5% drop in our economy next year," Planey said.

Planey says Wall Street is watching and business leaders and job creators are watching and waiting. "I saw a statistic that American companies have just under two-trillion dollars of cash in the bank on their balance sheets and they're not going to spend it or invest it until there is clarity about the future direction of this economy."

House Speaker John Boehner opposes tax hikes and supports tax code revisions to generate revenue. "Raising tax rates will slow down our ability to create the jobs that everyone says they want," Boehner said.

From the auto industry and its suppliers to defense contractors, manufacturers, large and small, will be affected should taxes explode and paychecks get smaller.

Planey says Washington has to take action.

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