In a meeting with the Business Roundtable, a trade group representing America’s big businesses, Obama will warn executives that another fight over government spending and the debt limit could harm businesses and consumers, a White House official said in a statement previewing the speech.
“The President will ask the business community to help send the message to Congress that a default would be disastrous for our economy and for businesses across the country,” the official said. “Many reasonable Republicans have said it would be reckless and irresponsible to use the threat of default as a bargaining chip, but some of the extreme members of the Republican Party continue to threaten the full faith and credit of the United States government.”
But as the president speaks, the likelihood of a deal to avoid a government shutdown or raise the debt ceiling seems to be diminishing. House GOP leaders appear ready to embrace a strategy that would fund the government and also undermine Obama’s signature health care law, the Affordable Care Act. The president and Senate Democrats pledge that the bill will never make into law.
Lawmakers must pass a measure funding the government by Sept. 30 or risk a government shutdown. Much more significantly, Obama will say, they must soon agree to raise the federal debt ceiling or risk a cataclysmic debt default. According to estimates, the government could run out of funds to pay all bills as soon as Oct. 18 (but potentially as late as early November.)
“The President has been clear that there is no negotiating over the whether or not Congress should pay its bills; Congress needs to pass a budget to keep the government functioning for the American people,” the White House official said. “But some Republicans in Congress are playing a reckless political game by threatening to leave the economy hanging in the balance for an ideological agenda that has no chance of becoming law — a game that last time had real consequences, hurting growth and business confidence.”
Brendan Buck, a spokesman for House Speaker John Boehner (R-Ohio), said in a statement: “No one is threatening default. The president only uses these scare tactics to avoid having to show the courage needed to deal with our debt crisis. Every major deficit deal in the last 30 years has been tied to a debt limit increase, and this time should be no different.”
Obama is expected to remind executives of the economic damage done through a clash on the debt limit in 2011, when the stock market fell 17 percent and the U.S. credit rating was downgraded.
“Thanks to the grit and resilience of the American people, we’ve cleared away the rubble from the financial crisis and begun to lay a new foundation for stronger, more durable economic growth,” the White House official said. “The last thing we can afford right now is a decision from Congress to throw our economy back into crisis by refusing to pay our country’s bills or shutting down the government.”