WASHINGTON — U.S. Chamber of Commerce President Tom Donohue urged Congress Thursday to pass spending cuts and tax reform, but suggested that the threat of defaulting on the national debt should not be used as leverage to force those cuts.
The deal that Democrats and Republicans struck at the beginning of January to avert the fiscal cliff pushed off several of the major issues to be dealt with over the next few months — including the sequester and raising the debt ceiling.
Some Republicans have suggested that House Republicans ought to use the debt limit as leverage to get the spending cuts that they failed to get in the January deal.
But Donohue suggested that was not the ideal way of handling it.
“We should not default on our debt,” Donohue told reporters in a question-and-answer session following the delivery of his State of Business address Thursday.
“There are all sort of arguments of what you use as a stimulus here — you use the debt, you use sequestration, you use the budget. And I think, yes people are going talk about all of that,” Donohue said, but suggested that was perhaps not the best way to accomplish the reforms that they wanted.
Pressed on the issue later, Donohue reiterated his feelings on not defaulting, and added: “Nor do we believe that we should handle sequestration in a ham-handed way, meaning that there are better ways to deal with spending issues. Nor do we believe that we should run around without a budget for another year. Et cetera, et cetera.”
“But,” he cautioned, “if nobody wants to deal with the question of what do we do about bending the expenditure curve, what do we do with the mounting deficit and therefore the huge growing debt, members of the House and Senate and others are going to be calling on the leadership to use some of these methods.”
“We would hope that they do it in sensible ways. We should not default,” he said. “But beyond there, if we don’t deal with this spending issue, we’ll be in the same position in a short period of time.”
In his annual State of Business address earlier on Thursday, Donohue called for controlling spending, specifically “through common sense entitlement reform,” as well as tax reform. He also called for increased domestic energy focus, expanding trade, reforming — and lessening — regulation, and immigration reform.
