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Obama: Shutdown will 'throw wrench' into economy

Reuters with AP
President Barack Obama speaking at the White House, September 30, 2013.
Source: The White House

President Obama held an impromptu speech Monday to prepare Americans for a possible government shutdown.

Obama said if Congress doesn't pass a budget today and the government has to shut down, it would would "throw a wrench into the gears" of a recovering economy.

"A shutdown will have a very real impact on very real people," Obama said. "It does not have to happen."

He said allowing a shutdown would be the "height of irresponsibility." He urged the House to pass a short-term spending bill free of any conditions that would weaken the nation's 3-year-old health care law.

This came after the Senate rejected a House proposal to delay implementation of Obama's health-care law. House Republicans were preparing to vote on another stop-gap spending measure, this one putting off a requirement that people must obtain health insurance.

The president said his health-care law would still take effect on Tuesday, as scheduled — Congress can't shut it down.

In the event of a government shutdown, Obama said vital services would continue to operate but many government paychecks would be delayed and NASA would be shut down almost entirely.

Obama said several government services would continue to operate, including Social Security, Medicare and the mail system. Public safety would not be compromised and troops would continue to serve. Prison guards and border patrol will continue to work.

Earlier, the White House sought to quash any possibility that President Barack Obama would raise the U.S. debt ceiling by himself should Congress fail to do so before a mid-October deadline, as some have suggested he should.

The U.S. Treasury Department has said it will exhaust the nation's $16.7 trillion borrowing limit in less than three weeks. Unless Congress raises the cap, the government would go into default, which the administration and most analysts say would deal a disastrous blow to the U.S. and the global economy, where the value of U.S. government debt is sacrosanct.

(Read more: Here comes the DC shutdown: What you need to know)

"Even if the president could ignore the debt ceiling, the fact that there is significant controversy around the president's authority to act unilaterally means that it would not be a credible alternative to Congress raising the debt ceiling and would not be taken seriously by the global economy and markets," White House spokesman Jay Carney told reporters.

Congressional Republicans say they will not raise the debt limit unless Obama agrees to delay his signature healthcare program or cut spending deeply, both of which the president rejects. The stalemate has raised the specter of a default.

The government is on track to shut down at midnight Monday over a similar impasse over government spending.

(Read more: Obama: I'm 'not at all' resigned to a shutdown)

Former President Bill Clinton and others have said Obama should act on his own to avoid a default, citing the 14th Amendment to the U.S. Constitution, which says the validity of the public debt "shall not be questioned."

Is Congress run by a 'bunch of children'?

Obama in January said he would not use the 14th Amendment to unilaterally raise the debt ceiling, and White House spokesman Jay Carney repeated that reluctance on Monday, saying it is Congress's responsibility to act on the debt limit, not the president's.

"The president can't raise it by himself," Carney said. "This administration does not believe that the 14th Amendment gives the power to ignore the debt ceiling."

(Read more: Which agencies shut, and which stay open?)

Congressional Republicans are trying to make cuts to the health law, the Affordable Care Act, a condition for extending government spending, and have said they will set the same requirement for raising the debt limit.

After bruising budget battles in 2011 that led the United States to the brink of default, Obama is flatly refusing to negotiate over raising the debt ceiling, saying the consequences of not doing so are so dire that there should be no debate.

—By Reuters