Obama: No `Ransom’ for Debt Ceiling

Photograph by Pablo Martinez Monsivais/AP Photo

House Speaker John Boehner (left) and President Barack Obama during their 2011 meetings about the debt ceiling and budgets.

Updated at 12:15 pm EST

President Barack delivered a stern warning today to congressional Republicans — make that the House — about the looming debate over raising the nation’s debt ceiling.

It’s not a question of permitting new spending, Obama said.

It’s a matter of “paying the bills” for commitments Congress already has made.

Any debate over not raising the limit, he said, is “absurd.” The potential damage to the economy of not meeting the next deadline for raising the limit (expected sometime in mid-February) is too costly to even consider, the president said today in his final planned news conference of his first term.

“The issue here is whether or not America pays its bills,” he said. “We are not a deadbeat nation.”

He also issed a warning about the potential tactics that House Republicans in particular are discussing, including demanding a new round of spending cuts attached to each incremental increase in the debt ceiling.

“They will not collect a ransom for not crashing the American economy,” Obama said.

Why should House Republicans take the warning seriously, Bloomberg’s Julianna Goldman asked at the press conference, considering the compromises the president has made in previous debt ceiling and fiscal debates.

“I said we weren’t going to extend Bush tax cuts for the wealthy, and we didn’t,”  Obama said, noting that the debate about balancing the federal budget going forward involves both tax revenue and spending cuts.

“If we’re going to do balanced deficit reduction, the only way to do it is in a balanced and responsible way,” he said.   “What I’ve said is that I’m happy to have a conversation about deficit reduction.”

 

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