With only one week left to figure out a solution to the debt crisis and avoid an “imminent” default, President Barack Obama invoked Ronald Reagan and called for a “balanced approach” to resolve the impasse about the federal debt ceiling. In a nationally televised address, the President called on Americans to live “within our means” by asking “everyone to give a little without requiring anyone to sacrifice too much.”
Noting that both parties are “responsible” for solving the budget crisis, Obama endorsed the plan put forward by Senate Majority Leader Harry Reid — which calls for cuts in domestic and defense spending but still preserves entitlement programs like Social Security, Medicare and Medicaid– and rejected House Speaker John Boehner’s two-step “cuts only” approach.
Care2′s Robin Marty explains the differences between the Reid’s and Boehner’s deals. Reid’s plan would cut about $2.7 trillion and leave entitlement programs unaffected, without adding “any revenue raisers like rescinding Bush era tax cuts for millionaires or closing corporate loopholes.” Most of the plan’s $1 trillion in savings would be from troop drawdowns in Afghanistan and Iraq. Boehner’s “Two-Step Approach to Hold President Obama Accountable” calls for “$1 trillion ceiling raise in exchange for $1.2 trillion in cuts and caps,” and then “mandates another debt ceiling fight to be scheduled for October, 2011,” just in time for elections.
A ”balanced approach” has yet to be instituted because, said Obama, “a significant number of Republicans in Congress” refused to agree to anything but a cuts-only approach. Such an approach “doesn’t ask the wealthiest Americans or biggest corporations to contribute anything at all” and thereby places a “greater burden on working families” who are already scrambling to get by.
Compromise, said Obama, “has become a dirty word.” He emphasized that ”We can’t allow the American people to become collateral damage to Washington’s political warfare” and called on Americans to persuade their congressperson to vote against the Republican proposal.
In closing, Obama called on all members of US society to do their share in resolving the debt crisis and quoted Thomas Jefferson: “Every man cannot have his way in all things… Without this mutual disposition, we are disjointed individuals, but not a society.” The President noted that “The entire world is watching,” as it is indeed is: Earlier today, the International Monetary Fund called on the US to in essence “put its house in order” or risk losing its AAA credit rating and the confidence of large foreign holders of US treasury bonds. The negotiations about the US debt ceiling have become US partisan politics, but the results of these talks have effects far beyond our borders.
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