WASHINGTON,D.C. (WUSA) --- The Treasury Department told Congress Monday the federal government will reach in about one month the limit of its ability to borrow money, the so-called debt ceiling.
In what was billed as the last press conference of his first term in office, President Obama urged congress to raise that debt limit without tying the increase to spending cuts, as many Republicans have argued they will attempt to do.
"I want to be clear about this. The debt ceiling is not a question of authorizing more spending. Raising the debt ceiling does not authorize more spending. It simply allows the country to pay for spending that Congress has already committed to. These are bills that have already been racked up and we need to pay them.
"So while I'm willing to compromise and find common ground over how to reduce our deficits, America cannot afford another debate with this Congress about whether or not they should pay the bills they've already racked up.
"If congressional Republicans refuse to pay America's bills on time, Social Security checks and veterans' benefits will be delayed. We might not be able to pay our troops, or honor our contracts with small business owners. Food inspectors, air traffic controllers, specialists who track down loose nuclear material 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. It would be a self-inflicted wound on the economy. It would slow down our growth, might tip us into recession, and ironically, would probably increase our deficit.
"So to even entertain the idea of this happening -- of the United States of America not paying its bills -- is irresponsible. It's absurd. As the Speaker said two years ago, it would be -- and I'm quoting Speaker Boehner now -- "a financial disaster, not only for us, but for the worldwide economy."
"So we've got to pay our bills. And Republicans in Congress have two choices here: They can act responsibly, and pay America's bills; or they can act irresponsibly, and put America through another economic crisis. But they will not collect a ransom in exchange for not crashing the American economy. The financial well-being of the American people is not leverage to be used. The full faith and credit of the United States of America is not a bargaining chip.
"And they better choose quickly, because time is running short. The last time Republicans in Congress even flirted with this idea, our AAA credit rating was downgraded for the first time in our history; our businesses created the fewest jobs of any month in nearly the past three years; and, ironically, the whole fiasco actually added to the deficit," President Obama said.
Even as the president spoke, Speaker of the House John Boehner released a statement saying "The American People do not support raising the debt ceiling without reducing government spending at the same time.
"The consequences of failing to increase the debt ceiling are real, but so too are the consequences of allowing our spending problem to go unresolved," Boehner said.
The National Taxpayers' Union says the debt ceiling debate provides an opportunity to reduce spending.
"Members of Congress need to own up for their own responsibility for over spending here and say if we're going to raise the debt ceiling we're going to make sure we don't get into this situation again. We're going to hold the line on spending in the future. It's up to them as well as the president," said NTU vice-president Pete Seppp.
"Washington doesn't treat the debt ceiling like a game of chicken. It's a game of chicken little. It's who can cluck the loudest about pending disaster. The truth is both sides need to face up to their own failures here and move forward constructively. That means approving the debt ceiling with ironclad reductions in spending this year, not down the road," Sepp told 9News Now.
The debt ceiling debates, he says, are important.
"It's another chance to hold congress accountable for its failures to control spending.The president should be welcoming these votes not shunning them," Sepp said.