US President Obama has said he is willing to hold
budget talks with Republicans, but not until they
agree to lift "threats" against the economy.
Mr Obama said they were committing "extortion" by
demanding policy concessions in return for raising the
US debt limit and reopening government.
The US government shut down last week when
Congress failed to agree a budget.
Republican leaders on Tuesday reiterated calls for Mr
Obama to open negotiations over ending the impasses.
Republican House Speaker John Boehner told reporters
he was "disappointed that the president refuses to
negotiate".
He said the president's position not to talk with
Republicans "until [they] surrender" was not
sustainable, and any discussions regarding the debt
ceiling must address how the nation is "living beyond
its means".
At the White House, Mr Obama said he had spoken to
Mr Boehner and was "happy to talk with him and other
Republicans about anything".
But Mr Obama said any negotiations on the ongoing
government shutdown or the debt limit "shouldn't
require hanging the threats of a shutdown or economic
chaos over the heads of the American people".
"We can't make extortion routine as part of our
democracy," Mr Obama said. "Democracy doesn't
function this way. And this is not just for me. It's also
for my successors in office, whatever party they're
from."
'Very deep recession'
He also warned of the repercussions of defaulting on
the government's debt should Congress fail to raise the
borrowing limit, currently set to be reached on 17
October.
Mr Obama said breaching the borrowing limit could
disrupt capital markets, undermine international
confidence in America, permanently increase the
nation's borrowing costs, add to its deficits and debt,
and pose the "significant risk of a very deep recession".
The US government partially shut down operations on
1 October after Republicans who control the House of
Representatives refused to approve a budget, saying
they would only do so if Mr Obama's healthcare reform
law were delayed or stripped of funding.
Mr Obama and the Democrats have thus far refused,
noting the law was passed in 2010, subsequently
approved by the Supreme Court, and was a central
issue in the 2012 election which Mr Obama won
handily.
At the same time, the Republicans have refused to
approve an increase in the US debt limit unless it is
accompanied by significant spending cuts and other
policy concessions.
Mr Obama maintains Mr Boehner could end the
current government showdown by allowing the House
to vote on a "clean" budget bill that does not alter the
health law, because that could pass with votes from
both Democrats and moderate Republicans.
But doing so would risk damaging his standing with the
most conservative elements of his caucus, analysts say.
'Too much shock'
US and foreign officials and economists have warned of
severe economic consequences if the US defaults on its
debt because the government is unable to borrow
money to fund its obligations.
"Failure to lift the debt ceiling would be a major event.
Prolonged failure... would almost surely derail the US
recovery," said International Monetary Fund economic
counsellor Olivier Blanchard on Tuesday.
"But the effects of any failure to repay the debt would
be felt right away... leading to potentially major
disruptions in financial markets both in the United
States and abroad."
Philippine President Benigno Aquino warned that what
happens in the US "affects us all".
"The US economy is the number-one economy in the
world," he said while attending the Asia-Pacific
Economic Cooperation (Apec) in Bali.
"The world economy obviously is not in a position to
withstand too much shock at this time."
At the White House, Mr Obama said that if the US
eventually dealt with the impasse "the way we should",
then "folks around the world will attribute this to the
usual messy process of American democracy but it
doesn't do lasting damage".
He sought to reassure US bond holders and others that
the country remained good for its debts, despite the
shutdown.
"My message to the world is the United States always
has paid its bills and it will do so again," Mr Obama
said.
The shutdown has already had a significant impact in
the US.
Hundreds of thousands of workers have been sent
home without pay, national parks, museums, and
tourists sites have been closed, research has halted, and
more.
On Monday, US defence contractor Lockheed Martin
said it would put 3,000 workers on unpaid leave,
warning that number would rise if the government
shutdown continued.
That announcement followed United Technologies'
decision to lay off 2,000 employees temporarily, saying
manufacturing had halted because there were no
government inspectors working to sign off products.
budget talks with Republicans, but not until they
agree to lift "threats" against the economy.
Mr Obama said they were committing "extortion" by
demanding policy concessions in return for raising the
US debt limit and reopening government.
The US government shut down last week when
Congress failed to agree a budget.
Republican leaders on Tuesday reiterated calls for Mr
Obama to open negotiations over ending the impasses.
Republican House Speaker John Boehner told reporters
he was "disappointed that the president refuses to
negotiate".
He said the president's position not to talk with
Republicans "until [they] surrender" was not
sustainable, and any discussions regarding the debt
ceiling must address how the nation is "living beyond
its means".
At the White House, Mr Obama said he had spoken to
Mr Boehner and was "happy to talk with him and other
Republicans about anything".
But Mr Obama said any negotiations on the ongoing
government shutdown or the debt limit "shouldn't
require hanging the threats of a shutdown or economic
chaos over the heads of the American people".
"We can't make extortion routine as part of our
democracy," Mr Obama said. "Democracy doesn't
function this way. And this is not just for me. It's also
for my successors in office, whatever party they're
from."
'Very deep recession'
He also warned of the repercussions of defaulting on
the government's debt should Congress fail to raise the
borrowing limit, currently set to be reached on 17
October.
Mr Obama said breaching the borrowing limit could
disrupt capital markets, undermine international
confidence in America, permanently increase the
nation's borrowing costs, add to its deficits and debt,
and pose the "significant risk of a very deep recession".
The US government partially shut down operations on
1 October after Republicans who control the House of
Representatives refused to approve a budget, saying
they would only do so if Mr Obama's healthcare reform
law were delayed or stripped of funding.
Mr Obama and the Democrats have thus far refused,
noting the law was passed in 2010, subsequently
approved by the Supreme Court, and was a central
issue in the 2012 election which Mr Obama won
handily.
At the same time, the Republicans have refused to
approve an increase in the US debt limit unless it is
accompanied by significant spending cuts and other
policy concessions.
Mr Obama maintains Mr Boehner could end the
current government showdown by allowing the House
to vote on a "clean" budget bill that does not alter the
health law, because that could pass with votes from
both Democrats and moderate Republicans.
But doing so would risk damaging his standing with the
most conservative elements of his caucus, analysts say.
'Too much shock'
US and foreign officials and economists have warned of
severe economic consequences if the US defaults on its
debt because the government is unable to borrow
money to fund its obligations.
"Failure to lift the debt ceiling would be a major event.
Prolonged failure... would almost surely derail the US
recovery," said International Monetary Fund economic
counsellor Olivier Blanchard on Tuesday.
"But the effects of any failure to repay the debt would
be felt right away... leading to potentially major
disruptions in financial markets both in the United
States and abroad."
Philippine President Benigno Aquino warned that what
happens in the US "affects us all".
"The US economy is the number-one economy in the
world," he said while attending the Asia-Pacific
Economic Cooperation (Apec) in Bali.
"The world economy obviously is not in a position to
withstand too much shock at this time."
At the White House, Mr Obama said that if the US
eventually dealt with the impasse "the way we should",
then "folks around the world will attribute this to the
usual messy process of American democracy but it
doesn't do lasting damage".
He sought to reassure US bond holders and others that
the country remained good for its debts, despite the
shutdown.
"My message to the world is the United States always
has paid its bills and it will do so again," Mr Obama
said.
The shutdown has already had a significant impact in
the US.
Hundreds of thousands of workers have been sent
home without pay, national parks, museums, and
tourists sites have been closed, research has halted, and
more.
On Monday, US defence contractor Lockheed Martin
said it would put 3,000 workers on unpaid leave,
warning that number would rise if the government
shutdown continued.
That announcement followed United Technologies'
decision to lay off 2,000 employees temporarily, saying
manufacturing had halted because there were no
government inspectors working to sign off products.
Comments
Post a Comment