Obama Says Republicans Risk Making U.S. Debt ‘Deadbeat’
President Barack Obama criticized House Republicans for demanding conditions on raising the U.S. debt ceiling as he tries to shape the coming congressional debate over the nation’s budget priorities.
Speaking at the Jacksonville Port Authority in Florida today, Obama accused Republicans of skirting responsibility to “pay the country’s bills” and refusing to spend for needed investments in education, energy and research.
“That’s not an economic plan,” he told several hundred people in a humid warehouse. “That’s just being a deadbeat.”
The Florida speech was the third of what White House aides say will be a series of addresses designed to highlight the fragile economic recovery. With Congress set to take up spending bills as soon as next month, the speeches aim to ratchet up the pressure on Republicans as they return home to their districts for the August recess.
Following up on visits yesterday in the Midwest and today in Florida, Obama plans to travel to Chattanooga, Tennessee, next week to promote his proposals to boost domestic manufacturing at an Amazon.com Inc. (AMZN) distribution center.
“With an endless parade of distractions, political posturing and phony scandals, Washington has taken its eye off the ball,” Obama said in Galesburg, Illinois, yesterday. “I am here to say this needs to stop.”
House Speaker John Boehner, an Ohio Republican, said today that Obama is rehashing old proposals and taking the same failed approach to negotiating with lawmakers.
“His speech turned out to be all sizzle and no steak,” Boehner said at a news conference in Washington. “That’s assuming that there is any sizzle left after you’ve reheated the thing so many times.”
Asked if he’d meet with Obama on raising the $16.7 trillion federal debt limit, Boehner said that “it’s time for Congress to do it’s work.”
“Moving this through the regular order is the right way to do it,” he said. Boehner earlier this week said Republicans won’t agree to raise the debt ceiling without spending cuts, threatening a showdown with Obama, who said the limit must be raised without conditions to prevent a default. The current limit will be reached sometime between October and December.
In the debt ceiling debate two years ago, lawmakers and the White House battled for months before Obama signed an increase into law on Aug. 2, 2011, the day the Treasury Department warned that U.S. borrowing authority would expire.
While Standard & Poor’s stripped the U.S. of its AAA top credit rating as a result, investors indicated they weren’t concerned about the government’s debt or its ability to pay its bills. The yield on 10-year Treasury notes on Aug. 5, 2011, when S&P announced the downgrade, was 2.56 percent. The yield fell to as low as 1.39 percent on July 24, 2012.
The yield on the benchmark 10-year (USGG10YR) note fell two basis points, or 0.02 percentage point, to 2.57 percent at 3:41 p.m. in New York, according to Bloomberg Bond Trader Prices.
The debt limit is just one of a host of fiscal decisions facing Congress and the White House when members of Congress return to Washington in September. The two sides also are at odds over passing a budget for the fiscal year that starts Oct. 1 and replacing the automatic across-the-board spending cuts known as sequestration.
In Jacksonville, Obama reiterated a message he delivered four months ago at the Port of Miami, calling on Congress to fund upgrades of the country’s bridges, roads, and ports.
“We know strong infrastructure is a key ingredient to a thriving economy,” he told several hundred people gathered in a passenger hangar. “The world can’t wait for Congress to get its act together.”
The economy grew at a 1.8 percent during the first three months of the year, lower than its 2.5 percent average pace during the last two decades. The unemployment rate, at 7.6 percent in June, remains above its 6 percent average during the period.
While the benchmark Standard & Poor’s 500 Index (SPX) is up more than 18 percent this year and has almost doubled since Obama took office in 2009, the median household income of $51,500 in May remains 5 percent lower than in June 2009, the official end of the recession, according to estimates by Sentier Research.
Obama toured the Jacksonville Port Authority with Transportation Secretary Anthony Foxx in an effort to highlight the need to speed up projects by expediting permitting and cutting red tape. In 2011, Obama signed an executive order expediting environmental reviews and permit decisions for a selection of high priority infrastructure projects.
“The businesses of tomorrow will not locate near old roads and outdated ports,” he said.
In Florida, Obama was greeted by a full-page newspaper ad from the state Republican Party saying the state’s Republican governor, not the president, is responsible for the local economic growth.
“It is flattering you want to take credit for Gov. Rick Scott’s success,” the ad said. “But it would be better if you learned some lessons from Rick Scott on job growth.”
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