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Obama Signs Tax Compromise

President Barack Obama has signed into law a compromise that preserves tax breaks for Americans and benefits for the unemployed. Friday's signing ends a political battle between the president and some members of his own party.

President Obama says his agreement with Republican lawmakers is good news for the American people this holiday season. "By a wide, bipartisan margin, both houses of Congress have now passed a package of tax relief that will protect the middle class, that will grow our economy, and will create jobs for the American people," he said.

In an unusual show of bipartisanship, the House of Representatives voted late Thursday to approve the $858 billion deal. The bill received an almost-equal number of votes from each party.

The new law extends jobless benefits for the long-term unemployed, as the U.S. unemployment rate is stuck at 9.8 percent.

It will also prevent big New Year's Day tax increases, by extending tax cuts for Americans at all income levels, first approved during Mr. George W. Bush's presidency, for two more years.

Many Democrats in Congress objected strongly to continuing the tax cuts for the richest Americans, and complained that Mr. Obama had sacrificed his principles to get an agreement. However, more than half the Democrats in both houses of Congress voted for the compromise.

Mr. Obama acknowledges that there are elements of the legislation that alienated both Democrats and Republicans, and he said there are parts that he dislikes. But he says it is a good deal for the American people.

"That is the nature of compromise: Yielding on something each of us cares about, to move forward on what all of us care about. And right now, what all of us care about is growing the American economy and creating jobs for the American people," he said.

The president made the deal with the top Senate Republican, Minority Leader Mitch McConnell, who Friday attended his first bill-signing ceremony since Mr. Obama took office.

The top Democrats in Congress-House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid-did not attend the ceremony, nor did House Minority Leader John Boehner, who will almost certainly be the next Speaker.

Earlier Friday, President Obama met with the leaders of the nation's top labor unions, usually among his strongest political supporters, many of whom are angry about the agreement.

Union leaders wanted jobless benefits extended, but they opposed maintaining the tax cuts for the top wage-earners, saying that money should have been used to create jobs.

The union officials are also unhappy about the recent trade agreement with South Korea, among other issues.

White House spokesman Robert Gibbs says the meeting is part of the president's effort to hear many points of view on how to speed the economic recovery.

Mr. Obama met for more than four hours on Wednesday with the leaders of some of America's largest corporations.

He has also held separate meetings with liberal and conservative economists, who administration officials say support the tax cut deal.