Obama warns of debt crisis

President urges compromise

Monday, July 25, 2011 9:18 PM
Last updated Tuesday, July 26, 2011 2:17 AM
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WASHINGTON - Decrying a "partisan three-ring circus" in the nation's capital, President Obama criticized a newly minted Republican plan to avert an unprecedented government default tonight and said congressional leaders must produce a compromise that can reach his desk before the Aug. 2 deadline.

Jim Watson/Associated Press
“It is a dangerous game we’ve never played before, and we can’t afford to play it now,” President Obama said Monday night of the politics surrounding the debt crisis. “Not when the jobs and livelihoods of so many families are at stake.”

"The American people may have voted for divided government, but they didn't vote for a dysfunctional government," the president said in a hastily arranged prime-time speech. He appealed to the public to contact lawmakers and demand "a balanced approach" to reducing federal deficits.

Obama stepped to the microphones a few hours after first Republicans, then Democrats drafted rival fallback legislation Monday to avert a potentially devastating government default in little more than a week.

Obama said the approach unveiled earlier in the day by House Speaker John Boehner would raise the nation's debt limit only long enough to push off the threat of default for six months. "In other words, it doesn't solve the problem," he said.

The president had scarcely completed his remarks when Boehner made an extraordinary rebuttal carried live on the nation's networks.

"The president has often said we need a 'balanced' approach, which in Washington means we spend more, you pay more," the Ohio Republican said, speaking from a room just off the House floor.

"The sad truth is that the president wanted a blank check six months ago, and he wants a blank check today. That is just not going to happen."

Directly challenging the president, Boehner said there "is no stalemate in Congress."

He said the Republicans' newest legislation would clear the House, could clear the Senate and then would be sent to Obama for his signature.

The back-to-back televised speeches did little to suggest that a compromise was in the offing, and the next steps appeared to be votes in the House and Senate on the rival plans by mid-week.

Despite warnings to the contrary, U.S. financial markets have appeared to take the political maneuvering in stride - so far. Wall Street posted losses Monday but with no indication of panic among investors.

Without signed legislation by day's end on Aug. 2, the Treasury will be unable to pay all its bills, possibly triggering an unprecedented default that officials warn could badly harm a national economy struggling to recover from the worst recession in decades.

Obama wants legislation that will raise the nation's debt limit by at least $2.4 trillion in one vote, enough to avoid a recurrence of the acrimonious current struggle until after the 2012 elections.

Republicans want a two-step process that would require a second vote in the midst of a campaign for control of the White House and both houses of Congress.

There were concessions from both sides embedded in the competing legislation, but they were largely obscured by the partisan rhetoric of the day.

 Senate Republican leader Mitch McConnell of Kentucky urged Obama to shift his position rather than "veto the country into default."

And Reid jabbed at tea party-backed Republicans who make up a significant portion of the House GOP rank and file. The Nevada Democrat warned against allowing "these extremists" to dictate the country's course."

The measure Boehner and the GOP leadership drafted in the House called for spending cuts and an increase in the debt limit to tide the Treasury over until sometime next year. A second increase in borrowing authority would hinge on approval of additional spending cuts sometime during the election year.

Across the Capitol, Reid wrote legislation that drew the president's backing, praise from House Democratic leader Nancy Pelosi - and criticism from Republicans.

By design or not, the two sides' harsh remarks obscured concessions that narrowed the differences among the nation's political leaders as they groped for a way to resolve the economic crisis.

With their revised plan, House Republicans backed off an earlier insistence on $6 trillion in spending cuts to raise the debt limit.

And Obama jettisoned his longstanding call for increased government revenues as part of any deficit reduction plan.
Pending the president's televised speech, the White House also declined repeatedly to say whether Obama would veto the revised House measure.

White House communications director Dan Pfeiffer called the proposal "not a serious attempt to avert default because it has no chance of passing the Senate."

Not all Republicans were happy with their leadership's decision to scale back legislation that had cleared the House last week, only to die in the Senate.

Among House conservatives who have provided the political muscle for the Republican drive to cut spending, the revised legislation was a disappointment. "I cannot support the plan," said Rep. Jim Jordan of Ohio, one of the leading advocates of legislation that cleared the House last week and died in the Senate.

But two rank-and-file Republicans said their constituents were voicing concerns other than the rising federal debt.
Rep. Tom Rooney, R-Fla., said his office is getting calls from constituents saying, "If I don't get my Social Security check, it's your fault."

Rep. Tom Reed, a New York freshman, said many of his constituents are telling him to stand firm in his drive to cut spending. "But I will admit there's some anxiety in the district" about Social Security and other programs, he added.

As Boehner readied his legislation, Senate Democratic leaders called a news conference to announce their own next steps.

The Democrats' measure would cut $2.7 trillion in federal spending and raise the debt limit by $2.4 trillion in one step - enough borrowing authority to meet Obama's bottom-line demand.

The cuts include $1.2 trillion from across a range of hundreds of government programs and $1 trillion in savings assumed to derive from the end of the wars in Afghanistan and Iraq.

Boehner ridiculed the $1 trillion in war savings as gimmicky, but in fact, they were contained in the budget the House passed earlier in the year.

The legislation also assumes creation of a special joint congressional committee to recommend additional savings with a guaranteed vote by Congress by the end of 2011.
Yet in the maneuvering it appeared another of the president's long-held conditions appeared to be in danger of rejection.

Neither Boehner's measure nor the one Reid was drafting included additional revenue, according to officials in both parties.

In addition to a two-step approach to raising the debt limit, the House measure would require lawmakers in both houses to vote later this year on a constitutional amendment requiring a balanced federal budget.

An earlier bill, passed in the House last week but then scuttled in the Senate, would have required Congress to approve an amendment and send it to the states for ratification.

That same bill would have made $6 trillion in spending cuts in exchange for raising the debt limit.
Obama promised to veto that bill even before the House voted on it.

Each side offered accounts of secret maneuvering designed to put the other side in a poor light.
Democratic officials said Obama called Boehner on Saturday night, one day after the collapse of compromise talks, and offered to reduce his demand for new tax revenue by $400 billion.

In return, Obama said that he wanted Republicans to abandon their demand to cancel parts of the year-old health care law if future deficit cuts did not materialize.

This official said Boehner rejected the proposal Sunday.

Republicans disputed that account - and offered one of their own.

In their version of events, Reid agreed on Sunday night to a two-step approach to raising the debt limit that Obama has rejected.

Democrats denied it.

None of the officials involved would agree to be quoted by name.

Monday's debt developments

Congress has until Aug. 2 to raise the federal borrowing limit or the government will run out of money and possibly default on its debt. House Republicans say they won't raise the debt limit without equal spending cuts. President Barack Obama and Democrats insist that higher revenues must be included.

Monday's developments: House Republicans and Senate Democrats offered competing legislation that narrowed their differences over how to avert a government default. House Republicans backed off an earlier insistence on $6 trillion in spending cuts to raise the debt limit while President Barack Obama dropped his longstanding call for increased government revenues as part of any deficit reduction plan.

What's next: House Republican leaders were expected to share details of their proposal to the rank and file and begin planning a vote, perhaps as early as Wednesday. In the Senate, Democratic leaders were expected to offer details of their plan.

- Associated Press

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Chillen
17
Points
Chillen 07/26/11 - 11:54 am
0
0
factfinder. Reagan was an

factfinder. Reagan was an actor AND the President of the United States - for 8 years. Something obama will never experience.

As far as obama's intelligence, that point is debatable. His grades were not too good in college. He isn't smart enough to listen to what the America people ask for. He isn't smart enough to be sensitive to American citizens who are suffering in his economic depression - he travels, parties & golfs on their dime despite their woes. Doesn't seem too bright to me.

I don't believe he's doing what is best for the country. He's doing what is best for him and his progressive & communist pals. He certainly doesn't have my best interest at heart. He literally loathes the private industry.

I'd take 1 Ronald Reagan over 10,000 obamas. So would most Americans.

shrimp for breakfast
5418
Points
shrimp for breakfast 07/26/11 - 12:39 pm
0
0
I just hope they can settle

I just hope they can settle on something soon or every American will be affected. It's not just the people who won't get their Social Security and other federal monies. This deadlock will really do a number on the dollar and the economy.
God help us!

InChristLove
22407
Points
InChristLove 07/26/11 - 12:57 pm
0
0
" You must ask yourself why

" You must ask yourself why did people trust Presidet Reagan, was it based on substance or appearance."

Way to be subtle and throw the race card in there factfinder. I get so sick of this!!!

eagle
94
Points
eagle 07/26/11 - 01:02 pm
0
0
Obama always needs a crisis.
Unpublished

Obama always needs a crisis. If we don't have one, he'll make one. What a drama king! He's doing just what he wanted to do and that's tear this country apart economically. If the debt ceiling is not raised, SS checks/military pay will not be paid ONLY if Obama/Geitner choose not to send them out. At that point, it's their choice. Then cut all the inefficient agencies/people in the fed gov and cut gov pay. Get the spending under control and force a balanced budget.

Little Lamb
43412
Points
Little Lamb 07/26/11 - 01:13 pm
0
0
Hey, what's wrong here. From

Hey, what's wrong here. From today's print edition of the Chronicle we have this on page 5B:

WASHINGTON – The Obama administration moved Monday to crack down on international criminal networks from Mexico . . . calling them a growing threat to U.S. interests. Among its new steps, the administration said it will . . . block members from entry into the U.S.

And on the same page we have this:

WASHINGTON – President Obama promised a Hispanic group Monday that he would continue to push for a sweeping immigration overhaul even as he acknowledged frustration that he has failed to deliver on his promises. Speaking before the National Council of La Raza, Obama noted that he'd pledged during his 2008 campaign to “work tirelessly to fix our broken immigration system and make the DREAM Act a reality.”:

You cannot trust him to keep his promises. Don't you remember when he said during his State of the Union address that he would focus like a laser on jobs, jobs, jobs until the unemployment rate got to an acceptable level. He didn't do that, either. As soon as he turns his attention to something new, he loses his focus on what he earlier promised. Right now, he is focused only on re-election.

faithson
4606
Points
faithson 07/26/11 - 01:20 pm
0
0
@southernguy; Yes, except

@southernguy; Yes, except you will never get the independents nor the youth vote with a Bachman or Perry... Romney or better yet, Huntsman are viable, but a candidate from the left fringe will be the Republican's undoing should they so choose. A candidate without the religious baggage is what the Repub's need, heck even I would entertain Huntsman vs Obama.

Local Interests
40
Points
Local Interests 07/26/11 - 01:23 pm
0
0
It's important to keep in

It's important to keep in perspective what Boehner is NOT willing to compromise on, even though he does not represent the majority or have a majority of votes (across house and senate).

This has nothing to do with RAISING taxes. Obama is just trying to close tax loopholes and allowing unfunded tax BREAKS to expire AS SCHEDULED BY A REPUBLICAN (though that has already been delayed once). Boehner and the Tea party are going to shut down this country (anybody remember Gingrich - ask him how this works out) over their support for big oil (seen BP's just announced profits) and billionnaire hedge fund managers (who, by the way, do NOT create jobs).

Republicans have democrats willing to make significant cuts to government spending but that is just not enough - they want to make sure the rich keep getting richer. This has NOTHING to do with job creation. That is a big red herring swallowed way too quickly by some local followers.

Little Lamb
43412
Points
Little Lamb 07/26/11 - 02:06 pm
0
0
I'm sick and tired of this

I'm sick and tired of this "Boehner won't compromise" nonsense. Here's how the action went down:

Reid comes to Boehner and says, "We need to raise the debt ceiling."

Boehner says, "That's the wrong thing to do. We need to drastically cut spending immediately and we won't have to raise the debt ceiling."

Reid says, "That's too dangerous."

Boehner says, "I think I can get the members (of the House Republican caucus) to swallow a debt ceiling increase with a modest plan to reduce future spending."

Reid says, "I'll have to run it by Geithner and see what he says."

Geithner tells Reid, "Make Boehner agree to increase income tax rates on households and small businesses with total income over $250,000." Reid dutifully does Geithner's bidding.

Boehner says, "No. You are changing the goalposts every time."

You have to realize that Boehner did compromise when he agreed to tie raising the debt ceiling with the modest future cuts. It's the Democrats who are being intransigent with their demand for a tax increase tied to the debt ceiling legislation.

They can debate tax reform later. It's time to put the debt ceiling behind us temporarily.

follower
59
Points
follower 07/26/11 - 02:07 pm
0
0
This, from Wikipedia's page

This, from Wikipedia's page on Obama's campaign promise to end waste......before he was elected.......and not followed through on.

Eliminate unnecessary middle managers"Barack Obama will thin the ranks of Washington middle managers, freeing up resources both for deficit reduction and for increasing the number of frontline workers."—Obama's "The Change We Need In Washington"

[edit] Create 'SWAT' unit to improve federal programs"Barack Obama and Joe Biden will create a focused team within the White House that will work with agency leaders and the White House Office of Management and Budget (OMB) to improve results and outcomes for federal government programs while eliminating waste and inefficiency."—Obama's "The Change We Need In Washington"

Augusta resident
1368
Points
Augusta resident 07/26/11 - 02:02 pm
0
0
I say again: The President

I say again: The President has little say about it. Congress runs the country. He just signs off on stuff. He is only in election mode. He has been in election mode his entire political career.
All this reminds me of when Georgia was trying to figure out what to do with a $90 million surplus. They spent it on fishing and next thing you know we were broke and lost our homestead exemption. Just like there is a Costco where Bass Pro Shop was suppose to be. Not to mention the hundreds of thousands wasted on downtown parking studies and we still have a parking problem.
10 years ago they found a big oil reservour in the ocen. They said it's no help because it would take 10 years to get the oil. Well it's now 10 years later and we still need it.

hounddog
0
Points
hounddog 07/26/11 - 03:06 pm
0
0
painfully honest, ‘The plan
Unpublished

painfully honest, ‘The plan being proposed by the democrats would allow the "rich" to be taxed at the same rate that the average American is taxed at.’
You really should look things up before posting it. You might be honest but that don't make you correct.
The top 2% pay 70% of our taxes. Obama makes it seem like the top 2% pay only 2%. Is everyone that voted for him an idiot?

allhans
22970
Points
allhans 07/26/11 - 03:08 pm
0
0
If democrats would stop for a

If democrats would stop for a few minutes and look at the unemployment rate, the number "forced" (ahem) to live on welfare and unemployment, the loss of average income in most Americans, then they just might understand that we are in a crises mode already. I have heard that once you reach rock bottom you will fight your way back up. WE ARE THERE, and we are fighting.

blakkone
63
Points
blakkone 07/26/11 - 03:10 pm
0
0
To all the Republican-loving

To all the Republican-loving people who love to bash Obama with all the crazy nicknames, remember this...REPUBS DO NOT CARE ABOUT PEASANTS LIKE YOU AND ME. They care about the elite members of society who make millions. Politicians in general have their own agenda in mind and does not include the best interests of the US.

Why else would they allow the nation into default? Just raise the stupid ceiling and be done with it. You mean to tell me that another recession lies in the hands of just 2 men who cant make a decision? Puhleeeze...that's why there is no point in voting.

allhans
22970
Points
allhans 07/26/11 - 03:14 pm
0
0
Augusta resident. It starts

Augusta resident. It starts with Congress but then it must go through the Senate, even then the prez can do like Obama and threaten to veto whatever Congress passes.

allhans
22970
Points
allhans 07/26/11 - 03:19 pm
0
0
blakkone..The same attitude

blakkone..The same attitude you are taking is the reason the country is out of money and borrowing from China now.
Our situation is caused by bad leadership, (From both parties), it's kind of like being head of the household, somebody has to put their foot down.

blakkone
63
Points
blakkone 07/26/11 - 03:27 pm
0
0
ALLHANS...Exactly. This

ALLHANS...Exactly. This country is being run into the ground through bad leadership from both parties, just like u stated. thats why politics is a joke, cuz we're screwed from either side. I am not for or against Obama but i believe if McCain/Palin were in the White House we would be in the same predicament.

jmac
0
Points
jmac 07/26/11 - 03:42 pm
0
0
Factfinder: President Obama

Factfinder:

President Obama is by far one of the most intelligent presidents that this country has had. He looks out for the interest of the majority of people, he represents our country well interms of diplomacy.

The sad part of this statement is, the majority of the people are those who are not working, not paying taxes, collecting OUR tax dollars to live, and teaching the next generation how to do the same. We should not punich our successful Americans, rather hold every American equally accountable. Our country has turned to rewarding the sorry and punishing the hard-working.

It infuriates me to stand behind someone in the grocery store who buys steak and lobster with their government assistances debit card, she pulled out of her Coach purse, with her nails done, while talking on a cell phone, and driving away in a car nicer than most. If we can't pay our current obiligations...maybe the government needs to stop eating steak, disconnect the cell phone, have natural nails and drive an average car!! I'm sure there are PLENTY of wasteful spending the government can cut without raise the ceiling. Its time we sat down and realized luxuries are NOT necessities.

blakkone
63
Points
blakkone 07/26/11 - 03:41 pm
0
0
Why do we think that people

Why do we think that people who do not work do not pay taxes?? You do understand they pay taxes when they buy goods that gov't dollars do not buy. i.e. soap, detergent, furniture, movies, gas, cigarettes, liquor, cell phones, utilities, etc.

Please get off your soapbox JMAC and focus on the real issues. This nation will default because two grown men cant agree on one issue.

Insider Information
4009
Points
Insider Information 07/26/11 - 03:54 pm
0
0
Crossing my fingers that no

Crossing my fingers that no deal is reached.

ispy4u
0
Points
ispy4u 07/26/11 - 03:56 pm
0
0
I am laughing my behind off

I am laughing my behind off that some, for lack of a better word, person is questioning the President's intelligence. If I was placing a bet, I would put my money on the President, against any one of you.

follower
59
Points
follower 07/26/11 - 03:54 pm
0
0
blakkone, can someone

blakkone, can someone disagree with the policies of this President because they believe he is wrong, and not because he is black?

I'm surprised that some blacks don't claim he is bad for the country because he is half white.

That card is worn badly. Next excuse.

Chillen
17
Points
Chillen 07/26/11 - 04:04 pm
0
0
If he's so smart why can't he

If he's so smart why can't he fix the economy? Why has he made it worse?

Yep. He's not the sharpest tool in the shed - unless you are a mainstream believing liberal. And some, for lack of a better word, people will believe darn near anything. Like the "obama is smart" mantra. Sheeple.

jmac
0
Points
jmac 07/26/11 - 04:13 pm
0
0
BLAKKONE: My soapbox?? Your

BLAKKONE: My soapbox?? Your comment just proved my point, thanks!

"movies, gas, cigarettes, liquor, cell phones"

Let me correct myself...people would don't work, doesn't pay INCOME tax...which is much more than sales tax

55 F-100
1
Points
55 F-100 07/26/11 - 05:40 pm
0
0
The only phrase that

The only phrase that perfectly describes "O" in these news conferences was coined on WSB recently: "The expression on his face is that of a chicken watching a card trick".

Augusta resident
1368
Points
Augusta resident 07/26/11 - 05:59 pm
0
0
Once again the President has

Once again the President has now power. He can veto all he wants. That solves nothing. He can veto us into a crisis. I don't care. I will just invest in stock at a real low price.

allhans
22970
Points
allhans 07/26/11 - 06:12 pm
0
0
But, AR, what happens when

But, AR, what happens when you find the stock you bought is now worthless...and it is very likely.

Tyler-Ray_Daddy
44
Points
Tyler-Ray_Daddy 07/26/11 - 06:28 pm
0
0
FactFinder, see if you know

FactFinder, see if you know these facts; who said each below?

1) "Let me be absolutely clear. Israel is a strong friend of Israel's.
A. Barack Obama
B. Dan Quayle
C. Sarah Palin
D. George W. Bush

2) "I've now been in 57 states I think one left to go."
A. Barack Obama
B. Dan Quayle
C. Sarah Palin
D. George W. Bush

3) "On this Memorial Day, as our nation honors its unbroken line of fallen heroes, and I see many of them in the audience here today."
A. Barack Obama
B. Dan Quayle
C. Sarah Palin
D. George W. Bush

4) "What they'll say is, 'Well it costs too much money,' but you know what? It would cost, about. It it it would cost about the same as what we would spend. It. Over the course of 10 years it would cost what it would costs us. (nervous laugh) All right. Okay. We're going to. It. It would cost us about the same as it would cost for about hold on one second. I can't hear myself. But I'm glad you're fired up, though. I'm glad."
A. Barack Obama
B. Dan Quayle
C. Sarah Palin
D. George W. Bush

5) "The reforms we seek would bring greater competition, choice, savings and inefficiencies to our health care system."
A. Barack Obama
B. Dan Quayle
C. Sarah Palin
D. G eorge W. Bush

6) "I bowled a 129. It's like - it was like the Special Olympics, or something."
A. Barack Obama
B. Dan Quayle
C. Sarah Palin
D. George W. Bush

7) "Of the many responsibilities granted to a president by our Constitution, few are more serious or mor e consequential than selecting a Supreme Court justice. The members of our highest court are granted life tenure, often serving long after the presidents who appointed them. And they are charged with the vital task of applying principles put to paper more than 20 centuries ago to some of the most difficult questions of our time."
A. Barack Obama
B. Dan Quayle
C. Sarah Palin
D. George W. Bush

8) "Everybody knows that it makes no sense that you send a kid to the emergency room for a treatable illness like asthma, they end up taking up a hospital bed, it costs, when, if you, they just gave, you gave them treatment early and they got some treatment, and a, a breathalyzer, or inhalator, not a breathalyzer. I haven't had much sleep in the last 48 hours."
A. Barack Obama
B. Dan Quayle
C. Sarah Palin
D. George W. Bush

9) "It was interesting to see that political interaction in Europe is not that different from the United States Senate. There's a lot of I don't know what the term is in Austrian, wheeling and dealing."
A. Barack Obama
B. Dan Quayle
C. Sarah Palin
D. George W. Bush

10) "I have made good judgments in the past. I have made good judgments in the future."
A. Barack Obama
B. Dan Quayle
C. Sarah Palin
D. George W. Bush

All of the correct answers are the same person. Each of these quotes are directly from Barack Hussein Obama.
Now, you know why he brings his teleprompter with him everywhere he goes ...even when talking to a 6th grade class. And some members of the media continue to insist he is "The smartest man ever elected to the Presidency."

Augusta resident
1368
Points
Augusta resident 07/26/11 - 06:29 pm
0
0
As far as the race card

As far as the race card comment Obama hasn't cut any checks to any of us. He cut checks to companies that lost jobs anyway. The CEO of General Motors quit his job and got a $20million bonus. me and you, black or white paid for it. Do any of you know who your local senators and congressmen are? They are from here and represent you in DC. You need to get over Obama and consentrate on your locally elected officials. Your President is like Deke, he just waves at parades. bondinfo.org

blakkone
63
Points
blakkone 07/26/11 - 08:41 pm
0
0
"Let me correct

"Let me correct myself...people would don't work, doesn't pay INCOME tax...which is much more than sales tax"

Very true statement. But, people who do work try every way possible under the sun to pay as little taxes as possible. A very rich person can invest in mutual bonds and pay no taxes at all. Now tell me who is the better person, a) the one who doesnt work and pays no taxes or b) the one who will find and exploit all loopholes and deductions and write-offs to pay as little tax as possible, maybe even get a refund?

P.S. - I fall in category B.

workedforit
0
Points
workedforit 07/27/11 - 08:13 am
0
0
Any warning from odumba has
Unpublished

Any warning from odumba has about as much effect as chicken little saying the sky is falling.
This moron does not have a clue. Probably never will.
Just the sound of his voice produces nausea.
How is that hopey changey thing going for you now?

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