Obama signs legislation to avert default

(AP) - The U.S. avoided a feared and catastrophicdefault on the American debt, as lawmakers on Tuesday passed ameasure that ties an agreement to raise the government's capacityto borrow to steep cuts in government spending.

The Senate passed the measure Tuesday, a day after it passed theHouse of Representatives, and President Barack Obama quickly signedit into law.

The emergency bill increases the nation's $14.3 trillion cap onborrowing, thus avoiding default just hours before the midnightdeadline, and begins the process of curbing the country's spiralingdebt.

The administration had said the government could not pay all itsbills without the new borrowing authority, and it warned thatdefault would severely damage the global economy and push the U.S.back into recession or worse. Even with the legislation now inplace, there are fears that the last-minute sparring could shakerating agencies' confidence and harm the country's Triple-A creditrating.

Though the compromise deal passed, it deeply angered bothconservative Republicans and liberal Democrats. Many Republicanscontended the bill still would cut too little from federalspending; many Democrats said much too much.

A deeply frustrated Obama, while praising Congress for finallypassing the compromise bill, demanded legislators immediately turntheir attention to fixing the economy and creating jobs.

"We've got to do everything in our power to grow this economyand put America back to work," he said, shortly after the Senatevoted 74-26 to pass the measure.

He also said he was not giving up on his insistence thatCongress allow taxes to be raised on big corporations, through anend to loopholes, and the richest Americans once both houses returnfrom their summer recess in early September. The measure that nowbecomes law relies wholly on cutting spending as a tool forlowering the American deficit.

Obama: Deal reached to raise federal debt ceilingSouthwestern Conn. communities at risk of credit downgrade

sorry to interrupt
your first 20 are free
Access to News 12 is free for Optimum, Comcast®, Time Warner® and Service ElectricSM customers.
Please enjoy 20 complimentary views of articles, photos, and videos during the next 30 days.
you have reached your 5 view limit
Access to News 12 is free for Optimum, Comcast®, Time Warner® and Service ElectricSM customers.
Please login, create an account or subscribe to continue enjoying News12.
Our sign-up page is undergoing maintenance and is not currently available. However, you will be given direct access to news12.com while we complete our upgrade.
When we are back up and running you will be prompted at that time to complete your sign in. Until then, enjoy the local news, weather, traffic and more that's "as local as local news gets."