Obama Holds the Line on Shutdown, Debt Ceiling Negotiations

A morning phone call between the president and the speaker appears to have yielded little progress.

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A morning phone call between President Barack Obama and House Speaker John Boehner yielded little progress.

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A morning phone call between President Barack Obama and House Speaker John Boehner appears to have yielded no progress on ending a partial government shutdown and avoiding a potentially catastrophic default on the nation's debt.

[READ: How a Default Will Affect Average Americans]

Speaking Tuesday afternoon, Obama said he told the speaker in a morning phone call that he is willing to negotiate, but only if the shutdown ends and default is first averted.

"I am happy to talk with him and other Republicans about anything – not just issues I think are important, but issues that they think are important," said Obama. However, the president also said he told Boehner that these discussions "shouldn't require hanging the threats of a government shutdown [and] economic chaos over the heads of American people."

 

The phone call and subsequent statement come after weeks of acrimony over the nation's finances. The Republican quest to dismantle the Affordable Care Act has led to a standoff that brought on a shutdown that started on Oct. 1. The next big fiscal deadline comes on Oct. 17, when the nation is expected to exhaust its borrowing authority. After that, the U.S. could default on its obligations for the first time ever, which many economists say would result in economic catastrophe.

Both Democrats and Republicans remain firm not only in their policy positions but in painting each other as stubborn ideologues bent on getting their own way.

"If you're negotiating around buying somebody's house, you don't get to say, 'Well, let's talk about the price I'm going to pay,'" said Obama. "'And if you don't give me the price, then I'm going to burn down your house.' That's not how negotiations work.

[ALSO: Government Shutdown Could Slam Right Into Debt Ceiling]

Boehner took a similar tone at a Tuesday press conference.

"Frankly, by refusing to negotiate, [Senate Majority Leader] Harry Reid and the president are putting our country on a pretty dangerous path," he said, noting that Obama negotiated with him during the debt limit debacle that took place in the summer of 2011.

The Treasury Department warned last week that a default could result in a downturn worse than the Great Recession. Because the consequences are unthinkably bad, some experts and economists have proposed extraordinary measures to avoid default. Among those are the prioritization of payments from the Treasury and having Obama invoke the 14th Amendment and declare the debt ceiling unconstitutional.

At his Tuesday press conference, Obama stressed that the administration did not want to use such tactics if the nation gets to Oct. 17 with no deal between Democrats and Republicans.

"I am going to continue to be very hopeful that Congress does not put us in that position," later adding that "no option is good in that scenario."

On the topic of the 14th Amendment, Obama skirted legal issues and instead said that even avoiding the debt ceiling in that way could still cause serious economic damage.

[POLL: Americans Just as Divided as Congress Over Shutdown]

"What matters is that if you start having a situation in which there's legal controversy about the U.S. Treasury's authority to issue debt, the damage will have been done even if that were constitutional," he said.

Still, Obama did not definitively say his administration would not use those measures.

"We are exploring all contingencies," he said.

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