President Obama on Wednesday called on some of the nation’s top corporate executives to use their influence to avoid a showdown over the debt limit. The Republican Party’s brinkmanship on the debt ceiling is driven by what Obama called a “small faction” in Congress, which is demanding the repeal of the health care reform law in exchange for funding the government and possibly raising the debt limit so that the United States doesn’t default on its debt.
Speaking to the Business Roundtable in Washington, D.C., an association of chief executive officers from some of America’s biggest companies, Obama reaffirmed what he has been saying for months: He will not negotiate with Republicans over raising the debt ceiling.
“It is going to be important for all of you I think over the next several weeks to understand what’s at stake and to make sure that you are using your influence” to end Washington brinkmanship, Obama said, calling for a return to negotiations that do not “promise apocalypse every three months.”
The president lambasted the Republican strategy of using the debt ceiling to demand policies the GOP doesn’t have the votes to implement otherwise. “What I will not do is to create a habit, a pattern, whereby the full faith and credit of the United States becomes a bargaining chip to set policy,” he said. “It would fundamentally change how American government functions.” He added that when Republicans first threatened not to raise the debt limit in 2011, "we had negative growth at a time when the recovery just trying to take off."
Commemorating the five-year anniversary of the financial crisis, Obama noted how far the economy has come since its near collapse this time in 2008, but acknowledged that there is still far to go for a full recovery. But he did take the time to point out the progress made on reducing the deficit in recent years.
Continue Reading Below
“The deficits have been coming down at the fastest rate since World War II,” he said. “The deficit’s been cut in half since I came into office.”
The Congressional Budget Office estimates the deficit will be $670 billion when the 2013 budget year ends at the end of the month – a major reduction from last year’s $1.09 trillion.
Obama stressed that near-term discretionary spending, money going toward things like education and research and development, is not a cause for concern. Instead, the danger is long-term fiscal health driven by spending on entitlements and health care costs, the latter of which, he noted, has been reined in by health care reform. He stressed his willingness to work on these long-term problems.
On the other side of the debate, Republicans are accusing Obama of "brinkmanship" over the debt ceiling. During a Joint Economic Committee hearing on the economic costs of a debt ceiling fight, Republican Reps. Kevin Brady of Texas and Sean Duffy of Wisconsin both claimed Obama's unwillingness to negotiate on the debt ceiling was the real source of "brinkmanship" in Washington.