Obama: Debt solution possible in 2013

Oct. 24, 2012 at 1:33 PM
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DES MOINES, Iowa, Oct. 24 (UPI) -- President Barack Obama says he believes Washington will agree to "the equivalent of a grand bargain" on spending and taxes during the first six months of 2013.

In an interview Tuesday with the Des Moines Register, the president said the expiration of tax cuts enacted during the George W. Bush administration, and the prospect of deep cuts in defense and domestic spending, will act as "a forcing mechanism to deal with what is the central ideological argument in Washington right now, and that is: How much government do we have and how do we pay for it?"

"So when you combine the Bush tax cuts expiring, the sequester in place, the commitment of both myself and my opponent -- at least Governor Romney claims that he wants to reduce the deficit -- but we're going to be in a position where I believe in the first six months we are going to solve that big piece of business," he said.

"It will probably be messy. It won't be pleasant. But I am absolutely confident that we can get what is the equivalent of the grand bargain that essentially I've been offering to the Republicans for a very long time, which is $2.50 worth of cuts for every dollar in spending, and work to reduce the costs of our healthcare programs."

The interview had initially been conducted off the record at the request of the White House. Jen Psaki, a spokeswoman for the Obama re-election campaign, told reporters the newspaper had "expressed a desire to put this on the record, make it public" and the campaign agreed.

Obama told the newspaper the United States is "ahead of pace in the typical recovery" from recessions as severe as the financial meltdown of 2008, which he said was "not your typical business cycle recession" but "a very, very deep worldwide financial-based recession."

"But the potential for upside growth remains very strong. Keep in mind that we are growing faster than just about any other large industrialized country," he said. "We're growing faster than Europe. We're growing faster than Japan. And part of the challenge we have right now -- we've had a bunch of headwinds because Europe is still getting its act together. China, its economy has been weakened. And so world trade generally has been somewhat depressed over the last year."

The president said he is confident immigration reform can be accomplished in 2013.

"And since this is off the record, I will just be very blunt. Should I win a second term, a big reason I will win a second term is because the Republican nominee and the Republican Party have so alienated the fastest-growing demographic group in the country, the Latino community," Obama said.

The president said his record justifies a second term, citing middle-class tax cuts, Wall Street reform, healthcare reform, ending the war in Iraq, elimination of top al-Qaida leaders, a rebound in corporate profits and a recovery in stock markets.

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