Congressional Republicans want spending cuts in exchange for their blessing to raise the country's debt ceiling and are not out to send the country into default, says House Budget Chairman Rep. Paul Ryan, R-Wis.
The government has hit its $14.3 trillion debt ceiling, and Congress is deciding whether or not to lift it, or risk default by Aug. 2.
Republicans don't want to see that, Ryan says.
"We want to get real spending cuts with real process reforms that lock in and guarantee those spending cuts," Ryan tells CNBC.
(Getty Images photo)
"We see this as a necessary down payment on getting the debt under control and heading in the right direction. That will calm markets. We think that will buy us time in the credit markets."
Real fiscal reform will benefit everyone, Ryan adds.
"Default is not our strategy. Nobody wants to see that happening, but we don't want to see both political parties show the world and the credit markets that we just can't do anything about spending, that we just throw in the towel on America because we can't get our fiscal house in order," Ryan says.
Fed Chairman Ben Bernanke has said failure to raise the debt ceiling will damage investors' confidence in the U.S.
"I fully understand the desire to use the debt limit deadline to force some necessary and difficult fiscal policy adjustments, but the debt limit is the wrong tool for that important job," Bernanke says, according to the AFP newswire.
"Failing to raise the debt ceiling in a timely way would be self-defeating if the objective is to chart a course toward a better fiscal situation for our nation."
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