Debt showdown continues in Washington

(AP) - President Barack Obama said Friday Congress has a "unique opportunity" to stabilize the U.S. economy for decades by cutting deficits and raising the

WASHINGTON - (AP) - President Barack Obama said Friday Congress has a "unique opportunity" to stabilize the U.S. economy for decades by cutting deficits and raising the national debt limit to avoid a first-ever default.

He warned starkly that failure to do so by the Aug. 2 deadlinewould effectively mean "a tax increase for everybody" if thegovernment defaults, sending up interest rates and likely sparkinga global financial crisis.

Still, Obama said that Republicans opposition to any new taxrevenue was complicating efforts to reach a deficit-cutting deal.

"If they show me a serious plan I'm ready to move," he said.

The United States hit its current $14.3 trillion debt ceiling inMay and has been juggling its books since then. Republicans, whocontrol the House of Representatives, say they won't raise the debtlimit unless Democrats agree to major spending cuts to reduce thespiraling U.S. deficit. Democrats say cuts must be accompanied bysome tax increases. Republicans, prodded by junior members backedby the small-government tea party movement, oppose any tax hikes.

The president spoke at the White House Friday after five daysstraight of meetings with congressional leaders failed to yieldcompromise, and amid increasingly urgent warnings from creditagencies and the financial sector about the risks of failing toraise the government's borrowing limit.

Democratic and Republican congressional leaders agree on theneed to avert that outcome, but that hasn't been enough to getRepublicans to agree to the tax hikes on corporations and thewealthy sought by Obama - or to convince Obama and Democrats tosign onto the steep entitlement cuts without new revenue thatRepublicans favor.

The president spoke at his third news conference in two weeks onan issue that is increasingly consuming Washington and hispresidency.

advertisement | advertise on News 12

Trending Video

A man has been hospitalized after a shooting 1 Police: Man hospitalized after shooting on Nostrand Avenue
Two teens attempting to jump from one rooftop 2 Teen dies trying to jump between rooftops
Bay Ridge held its annual St. Patrick's Day 3 Bay Ridge holds annual St. Patrick's Day parade
Neighborhood Brief for March 26 4 Neighborhood Brief for March 26
News 12's Dan Serafin visited Lincoln High School 5 Lincoln H.S. alumnus plays in Sweet 16 of NCAA Tourney

advertisement | advertise on News 12

Features

Sorry to interrupt...

Your first 5 are free

Access to News12 is free for Optimum, Comcast®, Time Warner® and Service Electric℠ video customers.

Please enjoy 5 complimentary views to articles, photos, and videos during the next 30 days.

LOGIN SUBSCRIBE