President Obama: Deal Reached To Avoid Default

Jul 31, 2011 9:51pm

ABC News’ Mary Bruce (@marykbruce) Reports:

Faced with a looming economic crisis, the president came before cameras tonight to announce that “the leaders of both parties in both chambers have reached an agreement that will reduce the deficit and avoid default.”

“Is this the deal I would have preferred, no. I believe that we could have made the tough choices required on entitlement reform and tax reform right now,” the president admitted. “But this compromise does make a serious down payment on the deficit reduction we need and gives each party a strong incentive to get a balanced plan done before the end the year.”

Following a contentious Capitol Hill stalemate, the president admitted “this process has been messy. It has taken far too long.”

“Nevertheless, ultimately the leaders of both parties have found their way toward compromise and I want to thank them for that,” Obama said.

With just two days left to raise the nation’s $14.3 trillion debt ceiling, the president urged members of both parties to “do the right thing” and support the deal.

The agreement cuts roughly $1 trillion is spending over the next ten years and establishes a bipartisan committee to report back by November with a proposal to further reduce the deficit, which will then be put before an up or down vote, according to the president.

“In this stage, everything will be on the table. To hold us all accountable for making these reforms, tough cuts that both parties would find objectionable would automatically go into effect if we don’t act,” Obama explained.

“I’ve said from the beginning that the ultimate solution to our deficit problem must be balanced. Despite what some Republicans have argued, I believe that we have to ask the wealthiest Americans and biggest corporations to pay their fair share by giving up tax breaks and special deductions,” Obama said. “Despite what some in my own party have argued, I believe that we need to make some modest adjustments to programs like Medicare to ensure that they’re still around for future generations. That’s why the second part of this agreement is so important.”

Finally, the president thanked the American people for their role in moving this debate forward. “It’s been your voices, your letters, your emails, your tweets, your phone calls that have compelled Washington to act,” Obama said. “The American people’s voice is a very powerful thing.”

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