At President Obama’s final press conference of his first term held on Monday, he made clear his intention not to negotiate with the Congress over the debt ceiling in his second term. Said the president, “We are poised for a good year if we make smart decisions … and as long as Washington politics don’t get in the way…” His position on the debt ceiling issue is non-negotiable, according to the president:
Republicans in Congress have two choices here. They can act responsibly, and pay America’s bills, or they can act irresponsibly and put America through another economic crisis. But they will not collect a ransom in exchange for not crashing the American economy. The financial well being of the American people is not leverage to be used. The full faith and credit of the United States of America is not a bargaining chip.
And they better choose quickly, because time is running short.
And then, just to emphasize the point, the president invoked end-of-the-world-as-we-know-it rhetoric:
If congressional Republicans refuse to pay America’s bills on time, Social Security checks and veterans’ benefits will be delayed.
We might not be able to pay our troops, or honor our contracts with small business owners. Food inspectors, air traffic controllers, specialists who track down loose nuclear materials wouldn't get their paychecks.
Investors around the world will ask if the United States of America is in fact a safe bet. Markets could go haywire, interest rates would spike for anybody who borrows money: every homeowner with a mortgage, every student with a college loan, every small business owner who wants to grow and hire.
It would be a self-inflicted wound on the economy. It would slow down our growth [and] might tip us into a recession. And ironically it would probably increase our deficit.
So to even entertain the idea of this happening, of the United States of America not paying its bills, is irresponsible. It’s absurd.
The response from his targets, notably Senate Republican Leader Mitch McConnell and Speaker of the House John Boehner, was quick in coming. McConnell said that the president must get “serious about spending and the debt limit is the perfect time for it,” while Boehner pushed back: “The American people do not support raising the debt ceiling without reducing government spending at the same time.”
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Photo of President Barack Obama: AP Images