‘No magic tricks’: Obama says he won’t negotiate (or work around) the debt ceiling this time
In what's expected to be the final press conference of his first term, President Obama pledged again not to negotiate over the debt ceiling, while dismissing executive actions that might unilaterally pay the nation's bills without congressional action.
"The issue here is whether or not America pays its bills," Obama said, when asked if he was considering an alternative plan. "We are not a deadbeat nation."
Republicans have insisted that the president include spending cuts in any deal to raise the debt ceiling, despite his pledge not to negotiate on those terms.
As one reporter at the press conference pointed out, the president also said he wouldn't negotiate during the last debt-ceiling fight, and also insisted he wouldn't extend any of the Bush tax cuts, though he ultimately did.
"We’ve got to break the habit of negotiating through crisis over and over again," Obama said. "And now is as good a time as any, at the start of my second term. Because if we continue down this path, then there’s really no stopping the principle."
Democrats have tried to come up with some alternatives to bolster the president's ability to avoid default without acceding to Republican demands.
A somewhat fanciful notion of minting a trillion-dollar coin to pay the debt, or at least threatening to do so, gained considerable traction among liberal economists after it was endorsed by Rep. Jerry Nadler as a serious possibility. Proponents of the coin hoped that Obama would at least entertain the notion and leave open the possibility as a bargaining chip, but on Saturday night, the treasury department said it would not consider the option, in part because the Federal Reserve was unlikely to recognize the validity of the coin.
On Friday, a group of Democratic senators sent Obama a letter saying he should take "any lawful steps" to avoid default, and pledged their support, echoing House Minority Leader Nancy Pelosi who had previously said she would support the president paying the nation's debts under the authority of the Fourteenth Amendment guarantee of the vailidity of national debt.
Asked about the Fourteenth Amendment today, Obama said that "there are no magic tricks, no loopholes, no easy outs."
"There's a pretty straightforward way of doing this: set the debt ceiling aside, we pay our bills, and then we have a vigorous debate about how we're going to do further debt reduction in a balanced way," he said.
"My hope is that common sense prevails," he added.