Obama, Boehner Trade Blame For Debt Impasse

The deadline for raising the debt ceiling is one week from today, and political leaders are still mapping out divergent solutions.

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MARY LOUISE KELLY, host:

It's MORNING EDITION from NPR News. Im Mary Louise Kelly.

STEVE INSKEEP, host:

And Im Steve Inskeep.

Here's one way you can tell that the deadline for the debt ceiling negotiations is uncomfortably close. The cable news channels have started countdown clocks.

KELLY: According to the Treasury Department, the U.S. runs out of money to pay its bills one week from today. Tax revenues coming in will not be enough to meet U.S. obligations.

INSKEEP: Some financial experts are asking if there might be a few extra days of breathing room. Theyve seen unexpectedly strong tax revenues coming in lately.

KELLY: But nobody can be sure of that. And nobody doubts the U.S. is getting close to what business euphemistically calls a cash-flow problem.

INSKEEP: Time is especially short because Congress moves slowly. Democrats and Republicans are pursuing different plans.

NPR's Ari Shapiro reports on last night's dueling speeches.

ARI SHAPIRO: How many different ways can you say, lets get it done? Three weeks ago, the White House said we were in the endgame of debt negotiations. Friday the president's phrase was: We have run out of time. Last night, with a deal still out of reach, Mr. Obama stood in the White House East Room, stared straight into a camera, and said

President BARACK OBAMA: This is no way to run the greatest country on Earth. It's a dangerous game that we've never played before, and we can't afford to play it now.

SHAPIRO: Speaking from Capitol Hill immediately after the president, House speaker John Boehner called it a game of the president's making. Boehner has proposed a bill that would make modest spending cuts and raise the debt ceiling for six months, with more negotiations after that.

Representative JOHN BOEHNER (Republican, Ohio, Speaker of the House): Obviously I expect that bill can and will pass the Senate, and be sent to the president for signature. And if the president signs it, the crisis atmosphere that he has created will simply disappear.

SHAPIRO: It's not clear why the speaker thinks his bill can pass the Senate, which rejected a version of it last week. But even if it can, that bill will not solve the problem, said the president.

President OBAMA: A six month extension of the debt ceiling might not be enough to avoid a credit downgrade and the higher interest rates that all Americans would have to pay as a result.

SHAPIRO: Mr. Obama has thrown his weight behind an alternative plan that Senate majority leader Harry Reid proposed. It would cut more than two and a half trillion dollars in spending and raise the debt ceiling through 2012. Speaker Boehner called those promises of budget cuts phony accounting and Washington gimmicks.

Rep. BOEHNER: And the sad truth is that the president wanted a blank check six months ago, and he wants a blank check today.

SHAPIRO: This public sniping is hardly new. But until recently, there were at least private conversations that both sides say were productive. On Friday, the talks fell apart. Now both sides are pointing fingers as the country inches closer to default.

President Obama argued that the American people are fed up with a town where compromise has become a dirty word. He urged the public to speak up.

President OBAMA: If you want a balanced approach to reducing the deficit, let your member of Congress know. If you believe we can solve this problem through compromise, send that message.

SHAPIRO: When he says balanced approach, the president is talking about reducing the deficit through a combination of spending cuts and tax increases. Those tax increases are anathema to some House Republicans. And besides, there is no balanced approach on the table right now. Reid's proposal has spending cuts but no new revenues.

Still, Mr. Obama used that phrase, balanced approach, seven times in his 15-minute speech last night. The word compromise came up six times. Boehner suggested it's all an act.

Rep. BOEHNER: The president has often said we need a balanced approach, which in Washington means, we spend more and you pay more.

SHAPIRO: This artillery fire from one end of Pennsylvania Avenue to the other concluded a day that did little to calm anyone's nerves. Senate minority leader Mitch McConnell argued on the Senate floor that there is no economic reason to object to a six-month debt ceiling extension.

Senator MITCH MCCONNELL (Republican, Kentucky, Minority Leader): It's not the beginning of a fiscal year. It's not the beginning of a calendar year. Based on his own words, it's hard to conclude that this request has anything to do with anything other than the president's re-election.

SHAPIRO: And on the Democratic side, New York Senator Chuck Schumer said his party has moved totally in the Republicans' direction.

Senator CHUCK SCHUMER (Democrat, New York): So that is why the American people are saying that the cause of default and the cause of gridlock are the Republicans in Congress, not the president and not the Democrats in Congress. Because it hasn't been an evenhanded where we give some they give some.

SHAPIRO: There is a non-human outside arbiter of all these negotiations: The financial markets. Last night the Dow closed down 88 points and the price of gold hit a record high.

Ari Shapiro, NPR News, Washington.

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