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.

Yuri Gripas/Reuters
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.

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

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.

Both sides in the negotiations are busy arguing their case to the public.

In advance of Saturday’s meeting, Speaker Boehner’s spokesman, Brendan Buck, emailed reporters, “If the White House won’t get serious, we will. The Speaker is determined to tackle our spending problem in a significant way and, as he stressed last night, is committed to preventing a default on our debt. We will be working throughout the weekend with leaders in the House and Senate to find a serious solution.”

Both sides used weekend radio addresses to make their case. “This debate boils down to a simple choice,” Obama said Saturday. “We can come together for the good of the country and reach a compromise; we can strengthen our economy and leave for our children a more secure future. Or we can issue insults and demands and ultimatums at each another, withdraw to our partisan corners, and achieve nothing.”

Rep. Jeb Hensarling of Texas, the chairman of the House Republican Conference, blamed Democrats for a lack of progress. “The Democrats who run Washington are pretty good at telling us what they’re against, but they have yet to put a plan on the table that tells us what they’re for. Speeches and press releases won’t do the trick,” he said in the Republican radio address. “If we’re going to avoid any type of default and downgrade – if we’re going to resume job creation in America – the president and his allies need to listen to the people and work with Republicans to cut up the credit cards once and for all.”

The war of words will continue when the White House plans to roll out top officials to appear on the Sunday talk shows. White House chief of staff Bill Daley is a guest on NBC’s “Meet the Press” and CBS’s “Face the Nation,” and Treasury Secretary Timothy Geithner is on ABC’s “This Week,” CNN’s “State of the Union,” and “Fox News Sunday.

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