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White House warns of debt ‘Armageddon’

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WASHINGTON — The White House warned Republicans on Monday that failing to raise the $14.29 trillion US debt limit would spark “Armageddon-like” consequences for the slowly recovering US economy.

As a new political showdown looms over the economy following a defused budget row last week, aides also said that President Barack Obama now realized his vote as a senator against raising the debt ceiling in 2006 was a mistake.

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“The consequences … of failure to raise the debt ceiling would be Armageddon-like in terms of the economy,” said White House spokesman Jay Carney.

Congress must raise the US debt limit, or the maximum amount the Treasury is allowed to borrow, by May 16 or see the United States default on interest payments of its debt.

But the move has become embroiled in fiercely partisan battles over the economy and spending.

Carney warned that the result of failing to raise the debt ceiling were so grave, it would be irresponsible for politicians to exploit the drama for political gain.

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“We don’t need to pay chicken with our economy by raising the debt ceiling,” said Carney.

However, Republicans who control the House of Representatives are demanding vast new spending cuts from Obama — over and above the 38 billion dollars agreed to end the budget row last week, in exchange for raising the debt limit.

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Obama, under pressure to define the economic debate a week after launching his 2012 reelection battle, is due to tackle the issue — and a budget deficit that is set to reach 1.6 trillion dollars this year — in a major speech on Wednesday.

Treasury officials have said that failure to raise the debt limit could drive up interest rates, making it more difficult for Americans to borrow money at a time when home values are depressed and market-linked pension savings are down.

They also say that global confidence in the US economy would also be badly hit.

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The White House also delicately navigated around a vote made by Obama in March 2006 against a plan to raise the debt limit while George W. Bush was president, in protest at what he said was a lack of leadership.

“The president … regrets that vote and thinks it was a mistake,” Carney said.

“He realizes now that raising the debt ceiling is so important to the health of this economy and the global economy that it is not a vote that, even when you are protesting an administration’s policies, you can play around with.

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“You need to take very seriously the need to raise the debt limit so that the full faith and credit of the United States government is maintained around the globe.”

Carney also quoted the head of JPMorgan Chase, CEO Jamie Dimon, as saying that anyone who failed to raise the debt limit would be “crazy” and any move of that kind would have “catastrophic and unpredictable” results.

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Enjoy this piece?

… then let us make a small request. Like you, we here at Raw Story believe in the power of progressive journalism — and we’re investing in investigative reporting as other publications give it the ax. Raw Story readers power David Cay Johnston’s DCReport, which we've expanded to keep watch in Washington. We’ve exposed billionaire tax evasion and uncovered White House efforts to poison our water. We’ve revealed financial scams that prey on veterans, and efforts to harm workers exploited by abusive bosses. We’ve launched a weekly podcast, “We’ve Got Issues,” focused on issues, not tweets. Unlike other news sites, we’ve decided to make our original content free. But we need your support to do what we do.

Raw Story is independent. You won’t find mainstream media bias here. We’re not part of a conglomerate, or a project of venture capital bros. From unflinching coverage of racism, to revealing efforts to erode our rights, Raw Story will continue to expose hypocrisy and harm. Unhinged from corporate overlords, we fight to ensure no one is forgotten.

We need your support to keep producing quality journalism and deepen our investigative reporting. Every reader contribution, whatever the amount, makes a tremendous difference. Invest with us in the future. Make a one-time contribution to Raw Story Investigates, or click here to become a subscriber. Thank you.



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‘There’s an awful lot of really good Republicans out there’: Joe Biden at Cape Cod fundraiser

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Former Vice President Joe Biden defended Republican lawmakers in DC as "decent people" during a campaign fundraiser held at Cape Cod.

"There’s an awful lot of really good Republicans out there," Biden argued, according to Washington Post reporter Matt Viser.

"I get in trouble for saying that with Democrats, but...every time we ever got in trouble with our administration, remember who got sent up to Capitol Hill to fix it? Me," he said.

”Because they know I respect the other team. I do. They’re decent people," Biden claimed. "They ran because they care about things, but they’re intimidated right now.”

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Neo-Nazi ‘Atomwaffen Division’ holding live-fire militia training exercises at ‘The Base’: report

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One sign of the growing white nationalist crisis in America is a new outreach effort for paramilitary training.

"A neo-Nazi group focused on providing paramilitary-style training to far-right extremists has been conducting a massive recruitment drive and claims to have already conducted live-fire training with its members," Vice News reports.

"The Base, which is connected to extreme-right groups the Atomwaffen Division and the Feuerkrieg Division, has been promoting its growth on social media with photos announcing its presence in major cities across North America, including New York, Los Angeles, and Seattle, and in Europe, South Africa, and Australia," Vice reported. "The images often include a small contingent (typically one to three) of masked, camo-clad men holding weapons standing in front of The Base's flag, a black flag with three white lines running down the centre."

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Oklahoma police searching for man who shot Taco Bell employee in dispute over the drive-thru

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Police are searching for a man who allegedly shot a Taco Bell employee early Saturday morning.

"The employee was shot in the leg after asking the customer to pull forward in the drive-thru," KFOR-TV reported Saturday. "The customer argued, but eventually pulled forward, and that’s when he pulled out a gun and shot the employee."

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