American Companies Skittish as Default Looms

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President Obama and GOP lawmakers have remained intractable as they struggle to hammer out a deal that would trim more than $2 trillion from the national budget and raise the debt ceiling.

The president gave congressional leaders a homework assignment when they left the White House Monday:  Come back Tuesday with a plan to increase deficit reduction from $1.7 trillion to $2.4 trillion.

Mincing no words, Obama told lawmakers he won't sign a short-term deal to raise the debt ceiling.

"I will not sign a 30-day or a 60-day or a 90-day extension. It's not going to get easier. It's going to get harder. So we might as well do it now -- pull off the Band-Aid, eat our peas," he said.

Until then, Obama had given assurances that the debt ceiling would be raised, thus avoiding a first ever default.

Still, Treasury Secretary Timothy Geithner earlier Tuesday stressed that no one in government would let a government default occur.

"Let me be clear: the debt limit will be raised," Geithner told a Women in Finance Symposium Tuesday.

"Failure is not an option. Both sides understand what is at stake and will come to an agreement," he said. 

Republicans are also standing their ground, saying they won't sign a deal that raises taxes. 

"The president continues to insist on raising taxes, and there's just not enough support for entitlement reform to do it in the near to immediate future," House Speaker John Boehner, R-Ohio, said.

"It takes two to tango and they're not there yet," he said.

As the country waits for the two sides to make a deal, a potential default hangs in the balance. Moody's credit agency already threatened last month to downgrade the U.S. credit rating.

"This is something we're all going to feel. Financial markets would roll over,"financial analyst Greg McBride said.

"It's something we'd all feel in our retirement accounts, college savings accounts, but perhaps even worse, the flow of credit could come to a screeching halt," he said.

The threat of default is just one more reason for American companies to feel skittish. 
    
A new U.S. Chamber of Commerce survey says two-thirds of small businesses have no plans to hire in the coming year.
    
The owners of one Fort Lauderdale, Fla., family business have taken down their help wanted sign as they wait in fear to see what government leaders will do.

"Everyone is scared. Nobody is going to make a move," business owner Bill Feinberg said.

"We want to hire employees. We want to grow our business. We want to spend money on advertising. It's just difficult," he added.

The debt ceiling debate isn't just an American problem. The world waits anxiously as lawmakers in Washington keep talking. 

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Efrem Graham is an award-winning journalist, who comes to CBN News from the ABC owned and operated station in Toledo, Ohio.  He received his master's degree from the Columbia University Journalism School. He also holds a bachelor's degree in English Literature from the Richard Stockton College of New Jersey.  Follow Efrem on Twitter @EfremGraham and "like" him at Facebook.com/EfremGrahamCBN.