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President Barack Obama dismissed the House GOP’s newest idea of creating a supercommittee to deal with budget, suggesting it was a ruse to force Democrats to agree to concessions in return for reopening the government and raising the debt ceiling.
But he indicated he is open to signing short-term extensions of the debt limit and government spending.
“The bottom line is either you’re having good faith negotiations in which there’s give and take or you’re not,” Obama said at a Tuesday news conference. He argued that the working group House leaders would like to create would allow for discussion of spending and entitlement cuts, but not discussion of eliminating corporate loopholes and other Democratic priorities.
“I don’t know why Democrats right now would agree to a format that takes off the table all the things they care about and is confined to the things that the Republicans care about,” Obama said.
But the president said he might be open to such a panel — or any other negotiations — if Republicans agree to reopen the government and raise the debt ceiling. He noted that he would be willing to start talks even if bills to do that were short-term fixes of a few weeks or months, saying that if Congress can’t agree to a long-term plan quickly, “do it for the period of time in which these negotiations are taking place.”
“They can design whatever formats they want,” Obama said. “What is not fair and will not result in an actual deal is ransom-taking or hostage-taking — and the expectation that Democrats are paying ransom or providing concessions for the mere act of reopening the government or paying our bills.”
Obama said he has talked to members of Congress 20 times since March, and that his position of not negotiating around the debt limit has been clear.
“It’s not like this is a new position I’m taking,” he said.
The president also warned Tuesday that a failure to raise the nation’s borrowing capacity could result in a “very significant risk” of a new, deep recession and that “every American could see their 401(k)s and home values fall.”
Obama lambasted Republicans again for not believing that a debt default would be catastrophic to the economy, lamenting that there are “still some people out there who don’t believe default is a real thing.”
He said that even if, as some GOP lawmakers have suggested, he continued to pay foreign investors in Treasury bonds, other federal obligations, such as Social Security checks and veterans’ disability payments, might be delayed. Plus he said the country’s credit rating would be damaged, regardless of which payments the U.S. decides to make.
“If the markets are seeing that we’re not paying all our bills on time, that will affect our creditworthiness, even if some people are being paid on time,” Obama said. “No option is good in that scenario. There’s no silver bullet, There’s no magic wand that allows us to wish away the chaos that could result if, for the first time in our history, we don’t pay our bills on time.”
Steven T. Dennis contributed to this report.