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Obama pushes GOP on taxes in debt ceiling talks

By Tom Cohen and Alan Silverleib
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Obama pressed on debt ceiling
  • NEW: Speaker Boehner insists a debt deal including tax hikes will not pass the House
  • Obama calls for the GOP to move away from "maximalist positions" in debt talks
  • Obama says the War Powers Resolution does not apply to the U.S. intervention in Libya
  • Obama says it is up to individual states to determine if they will legalize same-sex marriage

Washington (CNN) -- President Barack Obama called on lawmakers Wednesday to overcome the "selfish" norms of politics and "do their job" in order to strike a deal on raising the federal government's current $14.3 trillion debt ceiling by the start of August.

People shouldn't get "spooked," but "the yellow light (is) flashing," he warned. "This is urgent."

Top economic analysts have warned of potentially catastrophic repercussions if the ceiling is not raised by August 2, including skyrocketing interest rates and a plummeting U.S. dollar.

The president blasted congressional Republicans for refusing to consider raising taxes on the wealthiest Americans as part of any deal. Congress needs to be willing to "take on their sacred cows and do tough things" while moving away from "maximalist positions," he said.

He said Congress should cancel upcoming summer vacations if a deal isn't struck by the end of the week.

"I want everybody to understand that this is a jobs issue. This is not an abstraction," he said. "If the United States government, for the first time, cannot pay its bills -- if it defaults -- then the consequences for the U.S. economy will be significant and unpredictable. And that is not a good thing."

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Obama made his remarks during a wide-ranging news conference covering the state of the economy, the wars in Afghanistan and Libya, and hot-button social issues such as same-sex marriage. It came at a time of rising questions over Obama's ability to maintain control of the political narrative and boost public confidence in his stewardship in the run-up to next year's presidential election.

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GOP leaders have shown no signs of yielding in their opposition to higher taxes as part of any grand bargain with the White House. Recent bipartisan talks led by Vice President Joe Biden collapsed over the tax disagreement.

"The president is sorely mistaken if he believes a bill to raise the debt ceiling and raise taxes would pass the (Republican-controlled) House," Speaker John Boehner, R-Ohio, said after Obama's news conference.

"A debt-limit increase can only pass the House if it includes spending cuts larger than the debt limit increase; includes reforms to hold down spending in the future; and is free from tax hikes," Boehner added. "The longer the president denies these realities, the more difficult he makes this process."

Senate Minority Leader Mitch McConnell, R-Kentucky, insisted earlier in the day that Republicans will "refuse to let the taxpayers take the hit when it comes to reducing the debt."

The debate is "about holding Washington accountable for a change," McConnell said. "It's about refusing to subsidize the Democrats' irresponsible spending habits another day."

For his part, the president ripped Republicans for protecting "millionaires and billionaires," oil companies, hedge fund managers, and owners of corporate jets.

The wealthy, he said, can afford to pay higher taxes.

"You can still ride on your corporate jet. You're just going to pay a little more," Obama said.

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At the same time, the president pushed Congress to act on a series of pending measures to help strengthen the economy faster, including easing the ability of entrepreneurs to get patents, providing loans to private companies for infrastructure development, and approving free trade agreements.

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Obama noted that America's economy has gone through a series of major structural changes.

As a result, the country's economic problems are "not going to be solved overnight," he stressed.

Turning his attention overseas, Obama dismissed criticism that his administration failed to obtain clear congressional approval before committing U.S. military forces to the NATO-led campaign in Libya.

Some representatives and senators on both sides of the aisle argue the White House has violated the 1973 War Powers Resolution, which gives a president 60 days to get congressional approval for sending U.S. forces to war, followed by a 30-day extension to end hostilities.

The combined 90-day period ended last week.

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Obama insisted that the War Powers Resolution does not apply in the case of Libya.

The law was intended to avoid a repeat of a Vietnam-style war, he said. In contrast, "this operation is limited in time and in scope."

"We have engaged in a limited operation to help a lot of people against one of the worst tyrants in the world," the president said. "A lot of this fuss" over the U.S. intervention in Libya "is politics."

It's become a "cause celebre for some folks in Congress," he asserted.

"We have done exactly what I said we would do" in Libya, Obama argued. America's allies "have carried a big load when it comes to these NATO operations" while "we've sent reams of information" to Capitol Hill.

"The noose is tightening" around longtime Libyan strongman Moammar Gadhafi, he asserted.

The president reiterated the administration's stance that Gadhafi's removal from power is "the primary way that we can assure that the overall mission in Libya of people being protected" is successful.

Obama's claims regarding the War Powers Resolution echoed those made Tuesday by Harold Koh, a top State Department legal adviser, who argued before the Senate Foreign Relations Committee that the law does not apply to American forces in Libya because the U.S. mission is limited in terms of its scope, means, exposure of forces, and chances of escalation.

In short, administration officials believe the U.S. role in Libya does not meet the law's definition of hostilities.

Obama, however, overruled contrary legal opinions put forward by both the Pentagon and the Justice Department's Office of Legal Counsel in declining to seek congressional authorization, according to the New York Times.

On Afghanistan, Obama insisted that the United States and its allies "can be successful in our mission, which is narrowly drawn."

The president, who recently announced the withdrawal of 33,000 American "surge" troops by next summer, declined to use the word "victory" in reference to winding down the Afghan military mission. He instead stressed the success of U.S. forces in dismantling al Qaeda and preparing Afghan forces to assume responsibility for the country's security.

Noting this week's bombing of Kabul's Inter-Continental Hotel, he warned that the violence in Afghanistan will likely continue for "some time."

Turning to the debate over same-sex marriage, Obama refused to provide new specifics about his personal opinion. A supporter of civil unions, he has indicated in the past that his views on the matter are "evolving."

He noted, however, that his administration has stopped defending the federal Defense of Marriage Act against legal challenges.

Obama argued it is up to states to determine if they will legalize same-sex marriage, as New York recently did.

"The president, I've discovered since I've been in office, can't dictate precisely how this process moves," the president said.

The nation is "moving toward greater equality," Obama added. "I think that's a good thing."