White House's Lew reports progress in debt ceiling talks
July 18, 2011, 11:55 pm TWN
WASHINGTON -- White House budget director Jack Lew on Sunday reported "activity and progress" in efforts to reach a deal to raise the U.S. debt ceiling and said he was confident that congressional leaders know default is not an option.
With time running short, President Barack Obama and lawmakers were struggling for ways to lift the debt ceiling and reduce the deficit as an Aug. 2 deadline to prevent a default draws dangerously close.
"I think it's not insignificant that all the leaders understand it would be irresponsible to get to Aug. 2 and not extend the ability of the United States to pay its obligations," Lew said on CNN's "State of the Union" program.
Lew said "quite a bit has been going on" in efforts to reach a deal since a meeting Thursday at the White House with Obama and Republican and Democratic leaders.
Obama, a Democrat, had said he wanted to hear from congressional leaders by the weekend about a way forward in the stalled debt talks but Saturday passed without an announcement of a new White House meeting.
Congress must raise the US$14.3 trillion limit on U.S. borrowing by Aug. 2 or the government will run out of money to pay its bills, causing turmoil in global financial markets and potentially forcing the United States into another recession.
Republicans want a deficit-cutting deal in order to support raising the debt limit, but they disagree with Democrats on how to do it. The White House wants some tax increases on wealthier Americans to be part of a package but Republicans reject that.
Prospects for a quick deal appear slim. Officials said Obama, Vice President Joe Biden and other staff discussed "various options" with lawmakers and other staff on Saturday but no significant progress was reported.
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