About 1.3 million Americans stand to lose jobless benefits on January 1 unless Congress agrees on an extension, and President Barack Obama and his fellow Democrats are trying to overcome opposition from Republican lawmakers to extend the benefits as part of a budget deal.

A joint report from the White House Council of Economic Advisers and the Labor Department estimated that without an extension of the benefits, GDP could be .2 percent to .4 percent lower.

Failing to extend jobless benefits, the report said, would reduce economic demand and cost 240,000 jobs next year. The current jobless rate is 7.3 percent.

"Since 1948 Congress has never allowed extended unemployment benefits to expire with unemployment rates as high as they are now," the report said.