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Pablo Martinez Monsivais/AP/Press Association Images

'Extortion not part of our democracy' - Obama on default threat

Yes, it’s the debt ceiling issue again.

FAILURE TO RAISE the debt ceiling would cause the United States to default on its bills, a situation “dramatically worse” than the current government shutdown, President Barack Obama warned in an address earlier today.

But he also sought to assure jittery markets and nervous countries that the US would honour its debts despite the looming deadline for Congress to raise the borrowing cap and avoid a cash crunch.

“As soon as Congress votes to reopen the government, it’s also got to vote to meet our country’s commitments, pay our bills, raise the debt ceiling,” Obama told a press conference.

“As reckless as a government shutdown is, the economic shutdown caused by America defaulting would be dramatically worse,” he added.

Obama criticised rival Republican Party lawmakers for setting unrelated conditions before they would agree to pass a new budget and raise the debt ceiling.

Members of Congress “don’t get to demand ransom in exchange for doing their jobs,” he said.

The shutdown of non-essential federal government services was in its eighth day Tuesday, with hundreds of thousands of workers furloughed, or sent home without pay, after Congress failed to pass a budget for the 2014 fiscal year that began 1 October.

Meanwhile the $16.7 trillion US borrowing ceiling needs to be raised by 17 October, when the Treasury says it will run out of cash and lack the funds necessary to fund a chronic deficit of about $60 billion a month.

But Republican House of Representatives Speaker John Boehner has warned that he will not allow Congress to raise the ceiling unless Obama offers concessions on his signature reform law that expanded health-care coverage.

Obama blasted that stance.

We can’t make extortion routine as part of our democracy. Democracy doesn’t function this way. And this is not just for me. It’s also for my successors in office, whatever party they’re from.

Meanwhile he sought to assure investors, US bondholders and others that the US remained good for its debts, even as he acknowledged “a cloud” over America’s economic credibility because of the shutdown.

“Obviously my message to the world is the United States always has paid its bills and it will do so again,” Obama said.

Asked what the government would do if the debt ceiling were not increased on time and the government would have to decide which bills not to pay, Obama said the issue was still being reviewed.

“No option is good in that scenario,” he said. “We are exploring all contingencies.”

- © AFP 2013

Earlier: Americans have a higher opinion of toenail fungus and dog poop than of Congress

More: Democrats plan to force Republicans into showdown on debt ceiling

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    Mute James Gorman
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    Oct 8th 2013, 9:39 PM

    The Republicans are devoid of integrity

    89
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    Mute Nick Hill
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    Oct 8th 2013, 9:44 PM

    Sounds like a job for the predator drones.

    55
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    Mute Jazz O'Gorman
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    Oct 8th 2013, 9:44 PM

    The true Obama is beginning to shine through, a lifeless puppet.

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    Mute Toby Parker
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    Oct 8th 2013, 10:29 PM

    Obama is no good. A war criminal.
    Yet some foolish people think that he craps sunshine.
    He has the blood of innocents on his hands.

    32
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    Mute Tesla Tower
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    Oct 8th 2013, 10:47 PM

    I hope you say that about all the commanders in chief since war began and not just Obama otherwise you’re been racist

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    Mute Toby Parker
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    Oct 8th 2013, 10:57 PM

    The Commander in Chief that’s protecting everyone’s freedom is it?
    And you condone the spying projects authorized by this Hero? Or the use of torture?
    Or the fact that he has more blood on his hands than any other terrorist organisation that you could care to think of?
    Well at least we all put on the aul green jerseys when he was over here and kissed his backside in the hopes that he might fire a few bob our way eh?
    Our Commander and Chief did everything but have the word “Welcome” tattooed on his back and lay down in front of Obama. Maybe he is saving that for his next visit?
    Do you really feel safer with “Commander and Chiefs” like Obama in the world??
    I sure as hell don’t.

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    Mute Tesla Tower
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    Oct 8th 2013, 11:19 PM

    All I’m saying is hate the game not the player it won’t change if he’s gone there’s a hole system put in place

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    Mute Toby Parker
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    Oct 8th 2013, 11:48 PM

    I call it like it is. The land of the free has been corrupted by the banks. War is big business.

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    Mute Burch Barlow
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    Oct 8th 2013, 11:51 PM

    Question, if he organised the bombing of militias in the democratic republic of Congo would he be a war criminal?

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    Mute gerbreen
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    Oct 9th 2013, 6:36 AM

    Commanders In Chief … they all have pretty bottoms

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    Mute bob®
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    Oct 8th 2013, 9:30 PM

    can of worms, but they’re in every government.sounds like stand Off,’first too blink’…

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    Mute TouchyMcFeely
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    Oct 8th 2013, 10:05 PM

    All the posters on here who call for an elected second house here to counteract the Dáil need to look at the paralysis that comes with that in the States. Those who condemn the whip system here need to note how the tail can wag the dog when small factions wield disproportionate power as the Tea Party does over there when not compelled to vote with the majority in their party.

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    Mute Tesla Tower
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    Oct 8th 2013, 10:24 PM

    Its all a dance. I remember when Ron Paul was running against Romney. Rand Paul did what the party said and went against his own dad and backed Mitt Romney for president. Ron Paul’s run was just a distraction tactic

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    Mute My Views
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    Oct 8th 2013, 10:44 PM

    And yet our vote on friday means we get either that or a facelifted Seanad that still has all of the sa

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    Mute My Views
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    Oct 8th 2013, 10:46 PM

    same problems it has today. That’s the white elephant in the reform room

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    Mute Truth Patrol
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    Oct 8th 2013, 11:04 PM

    Let it go Touchy. The people voted.

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    Mute Frank Hooper
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    Oct 8th 2013, 9:44 PM

    He likes to bomb kids, He likes to bomb kiiiiiiidddssss, Barack Obama, He likes to bomb kids

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    Mute Chris Doherty
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    Oct 8th 2013, 9:51 PM

    If America keeps increasing the debt where will they get the money to pay it back. I heard that the Chinese would take Hawaii as a swap for defaulted debt.

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    Mute Chris Doherty
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    Oct 8th 2013, 9:51 PM

    If America keeps increasing the debt where will they get the money to pay it back. I heard that the Chinese would take Hawaii as a swap for defaulted debt.

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    Mute SeanieRyan
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    Oct 8th 2013, 9:57 PM

    Their debt to GDP levels are not that bad, it might be in the trillions but their economy is a 16 trillion behemoth and it is starting to grow again.

    I normally support the Republican party but feel they are running wild here.

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    Mute Frank Hooper
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    Oct 8th 2013, 9:57 PM

    He’s a stone cold killer!

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    Mute Kevin Carroll
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    Oct 8th 2013, 10:09 PM

    What they’re doing is just printing money ie QE. However this will breed hyper inflation which will ultimately lead to the collapse of the dollar. The smart money is investing in physical gold/silver to hedge against dollar collapse.

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    Mute Michael Jordan
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    Oct 8th 2013, 10:16 PM

    Frank. In case you haven’t noticed. Nobody cares. You can waffle and spew your shite but nobody cares what you have to say.

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    Mute Frank Hooper
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    Oct 8th 2013, 10:27 PM

    You’re the only one spewing shite here mate

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    Mute Niall
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    Oct 8th 2013, 10:33 PM

    Dollar is on the verge of collapse, gold standard will be reintroduced soon

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    Mute Tesla Tower
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    Oct 8th 2013, 10:38 PM

    When you say their just printing money its more actuate to say their just buying debt and using it to purchase some fed dollars from a bank. So the more money been used the more debt their in and the less money they use the less debt but then we have recessions. The catch 22 of money creation

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    Mute Burch Barlow
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    Oct 8th 2013, 11:52 PM

    @ Niall, no it won’t.

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    Mute Declan noonan
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    Oct 9th 2013, 1:11 AM

    Niall, gold standard my bollix! There’s not enough gold in the world to run today’s economy anywhere.
    Seriously, people like you need to get a clue about the world we live in.
    There was a reason why the gold standard went away!

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    Mute paul breslin
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    Oct 9th 2013, 1:38 AM

    @Niall Funny they’ve been saying that since the 70s every time there’s a financial crisis and there’s been lots of them since.

    They’ve also been saying about the euro too since it was introduced. Maybe one day the chicken little, sky is falling people will be right but not this decade and probably not the next or the one after that.

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    Mute Emily Elephant
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    Oct 8th 2013, 11:36 PM

    Funny thing though. Normally extortion is when someone threatens you with something bad unless you give them money. In this case Congress has the purse strings. So who’s the extortionist?

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    Mute Tesla Tower
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    Oct 8th 2013, 11:41 PM

    Brilliant question

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    Mute Tigerisinthezoo
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    Oct 8th 2013, 11:52 PM

    Obama is in a tricky position. If the whole thing breaks down Obama’s image is finished. He will go down as the President who defaulted. The Republicans can let things fail. Ultimately, if things fall part it is the poorer Obama voters who will suffer most and the Republicans may well end up with the credit for stopping Obama’s policies.
    It is fine for Obama to bring in these policies but if they are not affordable in the long run he is doing the country a disservice.

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    Mute paul breslin
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    Oct 9th 2013, 1:44 AM

    Well if 1995 is anything to go by when Newt Gingrich pulled the same stunt the Republicans will lose their majority next year. The Republicans are going to give in first because Bohner knows this is bad long term for the country and their control of the house. The Tea Party is tearing them apart with their extremism.

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    Mute Danny
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    Oct 9th 2013, 8:13 AM

    His image is already finished. His policy of warrantless domestic and international spying will go down in history as the turning point towards our dystopian nightmare. And to think, he was the lesser evil. Christ…

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    Mute RiobairdOMaingain
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    Oct 9th 2013, 5:55 AM

    American domocray doesn’t do extortion, state sanctioned murder without trial is fine though

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    Dave
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    Mute Dave
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    Oct 9th 2013, 9:21 AM

    …it is when you’re Osama bin Laden and co.

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    Mute Martin
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    Oct 8th 2013, 9:48 PM

    It is in Ireland

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    Mute Kevin Gibb
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    Oct 9th 2013, 1:06 AM

    I hope he doesn’t think Yellen is the solution !!

    It’s only a matter of time, tick, tick, tock

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