White House says Congress must raise debt limit

The chairman of the White House Council of Economic Advisers warned a battle on borrowing costs and the budget might lead the U.S. to risk a credit downgrade.

WASHINGTON - The White House said on Friday it is vital for Congress to quickly resolve future tax and spending feuds, and raise the U.S. borrowing authority to avoid economic uncertainty.

"It is quite clear that the economy will be better if Congress does its job and does what it routinely has done historically which is raise the debt limit without problem," Alan Krueger, chairman of the White House Council of Economic Advisers, said in an interview on Bloomberg television.

Speaking just days after President Barack Obama and lawmakers settled a hard-fought "fiscal cliff" deal to avert tax hikes and spending cuts, he warned a battle on borrowing costs and the budget might lead the U.S. to risk a credit downgrade.

"I think we really are playing with dynamite with the debt ceiling," Krueger said in a separate interview on MSNBC. "Just go back to August 2011, we saw confidence plunge when Congress played Russian roulette with the debt ceiling. We saw job growth grind to almost a halt. So the economy will certainly do better if Congress does what it normally does, which is raise the debt ceiling without drama."

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