Democrats, Republicans appear no closer to averting massive federal cuts next month

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Sen. John McCain: Sequestration would be devastating

Key Republican lawmaker on 'Fox News Sunday'

Congressional Democrats and Republicans appeared far apart Sunday on a deal to avert $85 billion in federal spending reductions next month, with a top House Republican saying the cuts appear “inevitable.”

The automatic cuts, known as sequester, kick in March 1 because the parties have failed to agree on a less-drastic plan to cut the federal budget and deficit.

House Minority Leader Nancy Pelosi told “Fox News Sunday” that Democrats remain steadfast about tax increases being part of the deal but remain open to spending cuts.

“What we do need is more revenue and new cuts,” the California congresswoman said.

Pelosi said Democrats were “not talking about raising taxes,” but want to close tax loopholes, including those for U.S. oil companies.

She also argued Democrats have made $1.6 trillion in cuts over the past two years and suggested the bigger solution to the country’s economic problems is job growth.

Her argument is similar to the one President Obama -- who also has suggested stopping sequester with a mix of tax hikes and spending cuts -- is expected to restate Tuesday during his State of the Union address.

“We need a big, balanced, bold proposal,” said Pelosi, arguing more jobs result in more revenue. The interview was taped last week.

However, Oklahoma Rep. Tom Cole said fellow House Republicans will “absolutely not” accept tax increases as part of a deal, which would trigger the cuts to federal defense and discretionary spending.

Cole told ABC News’ “This Week” that the president refused to agree to spending cuts during the recent, so-called “fiscal cliff” negotiations so Democrats are not getting revenue increases now.

“I think (sequester) is inevitable, quite frankly,” he said.

Arizona Republican Sen. John McCain also said Sunday that Republicans don’t want tax increases, considering they just agreed to end more than $1 trillion in income tax breaks, but suggested he might be open to closing some tax loopholes.

He also urged both parties to work together to avoid sequester, which will result in big cuts to the defense budget and roughly $1.2 trillion in total cuts over the next decade.

“I’ll take responsibility as a Republican, but we’ve got to avoid it,” said McCain, the top Republican on the Senate Armed Services Committee. “The world is a very dangerous place.”