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Speaker John Boehner still faces a GOP House divided

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Obama will convene congressional leaders at the White House on Friday amid optimism on both ends of Pennsylvania Avenue that voters sent a message that they are tired of Washington dysfunction, creating an opportunity for compromise. Back-channel talks are already under way to shape a deal.

“It’s like they’re boxers in the ring, and they’re both dancing,” said Gabe Horwitz, director of the economic program at Third Way, a think tank aligned with moderate Democrats. “At least they’re in the ring.”

Failure to reach an agreement would result in automatic tax increases at the beginning of the year on virtually all Americans when the George W. Bush-era rates are due to expire. At the same time, massive federal spending cuts would take effect because Congress failed to find ways to trim the budget. Together, they would cause a fiscal contraction that economists warn would launch another recession.

Obama has been circumspect as he begins negotiations. But Democrats on Capitol Hill are emboldened by the president’s re-election as well as their gains in the GOP-controlled House and their strengthened majority in the Senate.

Senate Majority Leader Harry Reid of Nevada scoffed at the contention that this was a status-quo election, calling that “about as far off-base as you could be.”

“The Republicans are going to have to make the choice,” Reid said. “We’re willing to work something out.”

In both the House and Senate, key Republicans have shown a willingness to compromise on taxes as part of a broader deal to cut spending on entitlements, such as Medicare — especially after an election when high-profile tea party candidates lost their Senate races. That support could give Boehner a political safety net in negotiations.

“Look, the yin and yang of this, we know there has to be revenues,” Sen. Bob Corker, R-Tenn., said on “Fox News Sunday.” “I haven’t met a wealthy Republican or Democrat in Tennessee that’s not willing to contribute more as long as they know we solve the problem.”

But the conservative flank in the House and Senate shun suggestions of compromise and have been less than impressed by Boehner’s softer public tone.

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