President Barack Obama chastised congressional Republicans Monday for even suggesting they will not raise the nation’s debt ceiling next month, telling reporters in the East Room of the White House those lawmakers are “holding a gun to the heads” of the American people by threatening to shut down the federal government unless Obama agrees to dramatic spending cuts by the end of March.
The president also warned that Social Security and veteran's checks could be delayed if Congress does not act.
“We might not be able to pay our troops, or honor our contracts with small business owners,” he added. “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.”
“The debt ceiling is not a question of authorizing more spending. It simply allows the country to pay for spending Congress has already committed to,” Obama said, explaining that many mistakenly believe raising the debt ceiling would authorize more government spending. “The issue is if America pays its bills. We are not a deadbeat nation.”
Obama warned that allowing the nation to default on its loans could send the U.S into another recession, trigger a worldwide financial crisis and, ultimately, even increase the budget deficit. The president noted the U.S. credit rating was downgraded for the first time in history by Standard and Poor’s the last time Congress flirted with allowing the country to go into default.
The Treasury Department estimates the nation will hit its debt limit in either late February or March. In another looming deadline, the government would shut down if lawmakers refuse to extend the law funding current government operations by March 27.
A comprehensive deficit reduction plan will need new revenue, in addition to spending cuts, Obama said. The president has called for $4 trillion in deficit reduction over 12 years by closing tax loopholes that primarily benefit the wealthy, cutting non-security spending and reforming Medicare and Medicaid to reduce long-term costs.
Some Senate Democrats have encouraged Obama to take any steps necessary to ensure solvency, with some even suggesting he invoke a vague provision of the 14th Amendment that was originally intended to ensure the payment of Union debts after the Civil War. Obama has previously questioned the legality of such a step. But during Monday’s press conference he made it clear that questions of spending – as mandated by the Constitution – rest with Congress.
“There are no magic tricks here, there are no loopholes,” Obama said. “This is a matter of Congress authorizing spending.”
Although Republican leaders have said they will only raise the debt ceiling in relation to the amount of spending cuts agreed to by Democrats, Obama questioned their ability to actually reach such an agreement. The president, noting that lawmakers would have to find $2.5 trillion in spending cuts just to get the country through the next year in that scenario, pointed out that Congress has been unable to agree to even the $1.2 trillion in spending cuts mandated by the Budget Control Act of 2011.
Protecting the financial well-being of Americans, along with creating more jobs, reaching for energy independence, reforming immigration laws and protecting children “from the horrors of gun violence” are some of his goals for his second term, Obama said.
The president said he will be reviewing recommendations from Vice President Joe Biden’s gun safety task force in the coming days, and expect to discuss the issue in more detail by the end of the week. Obama would not comment on any specific policies up for consideration, but said he believes instituting stronger background checks, outlawing high-capacity magazine clips and instituting a meaningful assault weapons ban are all “common sense” solutions.
“Those of us who look at this problem have repeatedly said that responsible gun owners, people who have a gun for protection, for hunting, for sportsmanship -- they don’t have anything to worry about. The issue here is not whether or not we believe in the Second Amendment,” Obama said. “The issue is, are there some sensible steps that we can take to make sure that somebody like the individual in Newtown can’t walk into a school and gun down a bunch of children in a -- in a shockingly rapid fashion? And surely we can do something about that.”