US President Barack Obama
Source: Press TV
President Barack Obama has warned that the United States may revert to another recession if Congress fails to raise the current debt ceiling.
"We could have a worse recession than we already had, a worse financial crisis than we already had," unless the debt ceiling is raised before it hits its limit of $14.29 trillion in mid-May, Reuters quoted Obama as saying in a pre-recorded interview broadcast by CBS News on Sunday.
Just as the White House and Congressional Republicans are at loggerheads over the debt and deficit, the US president made it clear that he does not expect either side to get everything it wants in the ongoing negotiations and that he must compromise with the Republicans.
Obama, however, noted that Republicans should not associate the debt ceiling decision with the spending cuts as part of deficit-reduction measures.
The debt ceiling set by Congress is a statutory limit imposed on the amount of money the US Treasury Department can borrow and if nothing is done by about August 2, there is a possibility that the government might default on its debt payment.
Even though Republicans have so far refused to increase the ceiling without future spending cuts, Obama said he is confident that Congress ultimately would raise the limit.
On Sunday, US Treasury Secretary Timothy Geithner added his voice to Obama's calls for Congress to raise the $14.29 trillion debt ceiling, saying failure to do so would drive up interest rates, push down household wealth and cause a double-dip recession.