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Obama and congressional leaders hold grim Saturday meeting on debt crisis

President Obama convened an unusual Saturday meeting with Congressional leaders on the looming government default. The session lasted less than an hour, and the atmospherics appeared grim.

By Dave Cookstaff writer / July 23, 2011

President Obama and House Speaker John Boehner at a meeting about the debt limit Saturday. Obama called congressional leaders to the White House after a collapse in deficit talks left both sides angry and frustrated.

Yuri Gripas/Reuters

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Washington

President Obama convened an unusual Saturday morning meeting with Congressional leaders to discuss ways of averting a looming US government financial default.

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The session, which begin at 11:00 a.m., ended less than an hour later. After the session, House Speaker John Boehner, Senate Minority Leader Mitch McConnell, and White House Press Secretary Jay Carney issued brief statements.

“The bipartisan leadership in Congress is committed to working on new legislation that will prevent default while substantially reducing Washington spending," McConnell said. “Over this weekend, Congress will forge a responsible path forward,” Speaker Boehner added. “The leaders agreed to return to Capitol Hill to talk to their members and discuss a way forward, and conversations will continue throughout the day,” Carney said.

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Other attendees at Saturday’s gathering down the hall from the Oval Office were Vice President Joe Biden, House Minority Leader Nancy Pelosi, and Senate Majority Leader Harry Reid.

The scene at the session appeared grim.

The newspaper pool reporter who was allowed into the Cabinet Room briefly at the start of the meeting, Charles Lewis of Hearst, wrote to colleagues, “Strained body language suggested a school principal's office with a handful of sullen suspects sitting grimly downcast as the boss says: "OK, we're going to sit here all day until I find out who shot that spitball."

The sour atmospherics at the meeting were not surprising. The president summoned Congressional leaders to the White House for the session after negotiations with Speaker Boehner collapsed on Friday. Boehner finally returned Obama's call later in the day to say he was abandoning his talks with the president aimed at finding ways to raise the debt ceiling and trim the size of the government deficit.

Boehner accused the White House of moving the revenue “goalposts” for a deal and said he would seek a solution to the debt ceiling and deficit problem on Capitol Hill. Obama said Boehner had walked away from a deal that would have averted a government default and trimmed spending by $2.6 trillion.

Both the White House and congressional leaders are worried that markets will tumble if an agreement to raise the debt ceiling is not reached. While the Treasury Department has said the government will run out of borrowing power on August 2, as a practical matter an agreement is needed sooner so Congress can enact legislation based on the deal.

At a press conference Friday with less than an hour’s notice, President Obama warned, “It’s very important that the leadership understands that Wall Street will be opening on Monday, and we’d better have some answers during the course of the next several days.”

To underscore his point, Bloomberg reported that Treasury securities fell for the first time in three weeks as the talks collapsed. Yields on two-year Treasury notes touched the highest in almost two weeks on July 21 as Standard & Poor’s reiterated its prediction of a 50 percent chance of cutting the U.S. credit rating within three months.

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