If you think the government shutdown is bad, just wait until America defaults on its debt.
That was President Obama’s message on Tuesday — on day eight of the government shutdown and just nine days away from the country entering into default unless Congress can agree to a debt ceiling increase.
As “reckless” as the current government shutdown is, the commander in chief said at a press conference that an economic shutdown caused by America defaulting would be “dramatically worse.” It would be the first time in 225 years the country would not meet its financial obligations, he pointed out.
“The last time the Tea Party Republicans flirted with the idea of default two years, markets plunged, business and consumer confidence plunged. America’s credit rating was downgraded for the first time,” said Obama. He quoted experts who called a potential default “insane” and “catastrophic.”
Obama explained that raising the debt ceiling would not increase the nation’s debt but was simply allowing Congress to pay for what lawmakers already agreed to purchase, citing the nation’s military program and social security benefits.
Earlier in the day, the president called House Speaker John Boehner, reiterating to the Ohio Republican that he was willing to bargain but not until the House ends the shutdown and raises the debt ceiling.
Much of the showdown, of course, is a result of House Republicans quixotically rallying around a plan to delay or defund President Obama’s healthcare law. The president has said that he was willing to negotiate with the GOP, but that the government must reopen first. Obama has called for a debt-limit increase without any conditions, but GOP leaders have refused to budge unless specific spending reductions are put in play in exchange for a debt-limit hike.
“We’re not going to pay ransom for America paying its bills. That’s something that should be non-negotiable,” said Obama, insisting GOP lawmakers “can’t make extortion routine…democracy doesn’t function this way,” as it could set a precarious precedent in the future.
Obama also skewered some Republicans for downplaying the effects of going into default, calling it “really irresponsible.” Obama said “It’s particularly funny coming from Republicans claiming to be champions of business. There’s no business person that thinks this wouldn’t’ be a big deal…It’s unnecessary—that’s the worst part of it.”
The House is expected to vote as early as Tuesday on forming a bipartisan group made of House and Senate lawmakers to hammer out a deal on raising the country’s $16.7 trillion debt ceiling and to reopen the government. House GOPers will also bring up a bill to pay essential federal employees, including Capitol Police and others who have been deemed essential and have been required to still show up for work –not including furloughed employees.
President Obama expressed skepticism about the bipartisan committee the Republicans are pitching, pointing out there’s already the budget committees that “could come together right now.”
Obama said he was concerned that Republicans say they want negotiations in theory, but are hoping the Democrats (out of fear of a continued shutdown or default) give many concessions and the GOP gives nothing. “You can dress it up anyway you want. If that’s the theory the Republicans are going forward with, it’s not going to work.”
Republicans, including Boehner have argued have argued it’s Obama who’s not willing to negotiate. Boehner has also said there are not votes to pass a clean resolution to fund the government, which many experts have taken issue with, including Obama.
“Put it on the floor and see what happens,” said Obama.