In a his weekly address from Hawaii, President Obama reiterated that he will not negotiate with Republicans over raising the nation’s debt ceiling and said that any future efforts to reduce the deficit must include a combination of higher revenues and spending cuts.
Obama noted that additional revenue could come from closing tax loopholes and deductions Republicans themselves sought to reform throughout the 2012 presidential election and the fiscal cliff talks but were not altered in the compromise Congress passed to avert the fiscal cliff. Congress enacted $1.7 trillion in budget cuts last year and raised $620 billion in revenue in the fiscal cliff fix, a number that is far below House Speaker John Boehner (R-OH)’s offer of $800 billion during the cliff negotiations and lower than what would have been raised under Simpson-Bowles or Rivlin-Domenici.
From Obama’s remarks:
I believe we can find more places to cut spending without shortchanging things like education, job training, research and technology all which are critical to our prosperity in a 21st century economy. But spending cuts must be balanced with more reforms to our tax code. The wealthiest individuals and the biggest corporations shouldn’t be able to take advantage of loopholes and deductions that aren’t available to most Americans. And as I said earlier this week, one thing I will not compromise over is whether or not Congress should pay the tab for a bill they’ve already racked up. If Congress refuses to give the United States the ability to pay its bills on time, the consequences for the entire global economy could be catastrophic. The last time Congress threatened this course of action, our entire economy suffered for it. Our families and our businesses cannot afford that dangerous game again.
Since Obama signed the “American Taxpayer Relief Act of 2012,” the GOP has insisted that the measure “settles the level of revenue Washington should bring in” and have turned their attention to using the leverage of the debt ceiling to secure spending cuts and entitlement reforms.
During George W. Bush’s presidency, however, Republicans voted to increase the debt ceiling 19 times without ever demanding spending reductions, increasing the debt limit by nearly $4 trillion. In 2011, Boehner even warned of the consequences of holding the nation’s credit rating hostage. “That would be a financial disaster, not only for us, but for the worldwide economy,” Boehner said on “Fox News Sunday” of the risk of default. “I don’t think it’s a question that’s even on the table.”