White House holds out hope for ‘something big’ to avoid debt crisis

Associated Press

WASHINGTON

The White House held out hope today that congressional leaders still had time “to get something big done” with President Barack Obama as the deadline for raising the nation’s debt ceiling drew nearer without a solution.

“I think that what is encouraging is that the leaders in Congress seem to have all agreed that we can’t push to a default,” White House budget director Jack Lew said. “So I think that there are many conversations going on in order to make sure that doesn’t happen.”

The government will exceed the current $14.3 trillion debt ceiling on Aug. 2, after which it will be in default of its obligations. The consequences could be far-reaching, with potentially higher interest rates on mortgages and car loans, a halt in Social Security checks and unsettled world financial markets.

White House and congressional aides are continuing discussions today as Congress moves on two tracks to find a solution for increasing the nation’s borrowing authority while reducing long-term deficits. This comes after the failure to get a deal after five straight days of meetings between Obama and congressional leaders at the White House.