Raising debt ceiling U.S. avoids “default”; Obama urges Congress to nod trade deals

August 9, 2011 · Posted in stock options trading · Comment 
Tejinder Singh – AHN News Correspondent

Washington, D.C., United States (AHN) – The United States avoided the dreaded scenario of “default” on Tuesday and ended weeks of political circus in Washington as both Congress and the Senate passed the required bill raising the debt ceiling of the country allowing the U.S. Treasury to immediately borrow billions of dollars.

The legislations allows for more borrowing later but also aims to reduce the nation’s $14.3 trillion deficit by more than two trillion dollars over 10 years but the concern of rating agencies was still unclear leaving the chances of a downgrade for American credit rating open.

The White House announced during the regular daily briefing that President Barack Obama signed into law debt-ceiling legislation after the Senate passed the Congress approved bipartisan bill with a 74-26 vote on Tuesday before a midnight deadline to get a deal done. The House of Representatives passed the bill on Monday by a vote of 269 to 161.

Earlier addressing journalists at a Rose Garden news conference on Tuesday as the bill cleared the last hurdle of the Senate vote, Obama said, “This compromise guarantees more than $2 trillion in deficit reduction.”

Thanking “the American people for keeping up the pressure on their elected officials to put politics aside and work together for the good of the country,” Obama said, “It’s an important first step to ensuring that as a nation we live within our means.”

“This is, however, just the first step. This compromise requires that both parties work together on a larger plan to cut the deficit, which is important for the long-term health of our economy,” said Obama.

Admitting that the plan would need to include cuts to social programs and taxation on wealthiest Americans and biggest corporations, Obama said, “That means making some adjustments to protect health care programs like Medicare so they’re there for future generations.”

“It also means reforming our tax code so that the wealthiest Americans and biggest corporations pay their fair share,” said Obama, adding, “And it means getting rid of taxpayer subsidies to oil and gas companies, and tax loopholes that help billionaires pay a lower tax rate than teachers and nurses.”

Expressing his frustration over the way the political bickering went on for weeks, Obama said, “Voters may have chosen divided government, but they sure didn’t vote for dysfunctional government.”

In a message directed to the American lawmakers, Obama said, “When Congress gets back from recess, I will urge them to immediately take some steps — bipartisan, common-sense steps — that will make a difference; that will create a climate where businesses can hire, where folks have more money in their pockets to spend, where people who are out of work can find good jobs.”

“I want Congress to pass a set of trade deals — deals we’ve already negotiated — that would help displaced workers looking for new jobs and would allow our businesses to sell more products in countries in Asia and South America, products that are stamped with the words “Made in America,” Obama added in his call to Congress.

During the Senate debate, Republican Senator John McCain from Arizona in a statement said, “Mr. President, I support the legislation before us today to raise the debt ceiling and at the same time curb government spending without raising taxes.”

Saying that the U.S. “cannot default on our obligations and this bill prevents that from happening,” McCain said, “Mr. President, this measure represents the beginning — not the end — of what I believe will be a sustained national focus on getting our fiscal house in order. We still have a very long way to go and a great deal of hard work to do.”

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