(NSI News Source Info) TORONTO, Canada / WASHINGTON, US - JULY 28, 2011:
A Republican deficit reduction plan headed to a close vote in Congress on Thursday and the White House urged divided lawmakers to clinch a compromise deal to head off the risk of a debt default by the world's largest economy.
President Barack Obama's priority was to "lift the cloud and make sure that the United States does not default," White House spokesman Jay Carney said, five days before an August 2 deadline for raising the government's borrowing limit.
Partisan deadlock between Republicans and Democrats over how best to reduce the U.S. deficit, and over what period, has blocked an agreement so far to allow the raising of the $14.3 trillion debt ceiling.
A failure to raise the debt limit by August 2 could trigger a crippling default that would shake the global financial system and could tip the United States back into recession.
While most analysts hope a default will be avoided by an eleventh-hour deal, the risk remains for a damaging downgrade of the United States' top-notch credit rating, a move that would raise U.S. borrowing costs and rattle global investors.
Carney said the debt stalemate had "already had significant negative impact on the economy."
"The American people have made clear they want a compromise," he said. "Our primary objective has to be to protect the economy and the American people from economic harm."
The Republican-controlled House of Representatives has tentatively scheduled a vote on Thursday between 5:45-6:15 p.m. EDT on a deficit-cutting plan presented by the top Republican in Congress, House Speaker John Boehner.
Boehner has been cajoling fiscal conservative rebels within his own party to support his bill, which does not deliver the severe spending cuts as they demand.
"We don't have the votes yet, but we'll get there," a spokesman for Boehner said.
But the White House's Carney said Boehner's plan would not pass the Democratic-controlled Senate.
He said a successful compromise must significantly cut spending, install a mechanism to tackle tax reform and entitlement spending in the future, and lift the debt ceiling through next year.
"We need to start doing things that can pass both houses and be signed into law," he added.
The uncertainty over the U.S. debt talks outcome has been rattling global markets.
But after an initial fall, European shares ended higher on Thursday, snapping three consecutive sessions of losses on hopes a solution would be found to the debt crisis in the United States.
U.S. stocks rose on Thursday as better-than-expected data on home sales and employment lent support to the market after equities suffered their worst day in eight weeks in the previous session.
(Additional reporting by JoAnne Allen, Dave Clarke and Rachelle Younglai and Rick Cowan, Alister Bull, Caren Bohan, Laura MacInnis and Tabassum Zakaria in Washington, Anirban Nag in London; Writing by Pascal Fletcher; Editing by Vicki Allen)
Debt crisis: America faces a decision that will affect us allThe financial crisis will force the Obama administration to make a choice that will define its future - and ours.AFP Telegraph Finance News via Yahoo! UK & Ireland Finance - Jul 27 03:00pm
- US debt crisis: Is Obama's leadership style suited to the moment?Despite Obama's use of the bully pulpit in the showdown over the debt limit, he is not a direct party to negotiations. How much has his cautious leadership style contributed to his predicament?The Christian Science Monitor - Jul 27 08:02pm
- US debt ceiling crisis: Public anger mounts as politicians conti... - Daily Mail
- US debt crisis threatens global markets as Congress is l... - Guardian Unlimited
- Obama to warn of 'incalculable damage' if no debt de... - AFP via Yahoo!Xtra News
- all 296 news articles…
- US debt ceiling crisis: John Boehner calls for unity as Wall Street has worst day in 2 monthsAs public outrage continues to build over the inability of politicians to solve the nation’sdebt crisis, House Speaker John Boehner called a closed-door meeting of the entire House Republican conference this morning. 'Get your ass in line,' he told them. 'I can't do this job unless you're behind me.'Daily Mail - Jul 28 02:47am
- Plouffe: We Won't Accept Boehner's Short-Term Deal - The Online NewsHour
- Boehner Says Debt Bill Will Pass as Reid Says He'll Kill I... - The Atlantic Wire
- US debt talks face new obstacles - Business Spectator
- all 72 news articles…
- US debt crisis: Republicans delay key voteThe US Congress and world markets are facing more uncertainty after Republican leaders delayed action on a plan to raise the government's $14.3 trillion borrowing limit, narrowing the chances for a deal to avert a debt default.Daily Telegraph - Jul 27 03:00am
- US lawmakers set key debt vote as deadline looms - Channel NewsAsia
- Debt crisis a big test for US House of Representatives S... - The Economic Times
- US debt crisis worries coalitio... - Politics.co.uk via Yahoo! UK & Ireland News
- all 98 news articles…
- US debt crisis: Is Obama's leadership style suited to the moment?As the clock ticks down toward a possible default on US debt, President Obama’s leadership style is coming under increasing scrutiny.Christian Science Monitor via Yahoo! Canada News - Jul 27 07:58pm
- Obama warns of 'dangerous game' over US deb... - AFP via Yahoo! UK & Ireland News
- Americans' debt rage boils over - New York Post
- US debt crisis: full text of Barack Obama's address - Daily Telegraph
- all 93 news articles…
- US debt crisis gives investors first joltPresident Barack Obama's Democrats and their Republican rivals were further apart than ever today in an impasse over the government's debt limit as investors braced for a looming US default and downgrade.Independent - Jul 26 05:05pm
- US stocks plunge as debt crisis deepensUS stocks plunged overnight as the country edged closer to defaulting on its debt and the economy showed more signs of deteriorating.Daily Telegraph - Jul 27 07:16pm
- Global stocks fall on US debt crisis - GlobalPost
- Stocks fall, Australia dollar up on US debt deadlock - The Malaysian Insider
- Strong jobs report pushes US stock futures up - AP via Yahoo! Finance
- all 80 news articles…
- Doubt over fix for US debt crisisRepublicans and Democrats have rushed to rework rival deficit reduction plans, but with the fate of both proposals heavily in doubt top lawmakers have pursued a behind-the-scenes compromise to avert a crippling US debt default.Marlborough Express - Jul 27 03:46pm
- Rivals canvass support for plans to solve US debt crisis - The Irish Times
- Analysts: Senate plan saves $2.2 trillion - AP via Yahoo! Malaysia News
- GOP retools plan as Congress seeks debt fix - Fernley Leader
- US debt crisis: markets focus on implications of a defaultWith Washington yet to seal a deal on raising America's $14.3 trillion debt ceiling, market-watchers weigh in on the failure to halt the slide towards a default.AFP Telegraph Finance News via Yahoo! UK & Ireland Finance - Jul 28 07:18am
- Debt crisis: America faces a decision that will affect us allThe financial crisis will force the Obama administration to make a choice that will define everyone's future, says Jeremy Warner.Daily Telegraph - Jul 27 03:15pm
- US debt default seen as unlikely outcome - People's Daily
- Obama warns of US debt crisis - Daily Telegraph
- Opinion: A trillion-dollar coin and other ways that Obama can avoid defa... - CNN