Obama: Looming spending cuts hurting economy

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WASHINGTON -- President Barack Obama said yesterday looming automatic spending cuts are already affecting the economy, while a top administration official warned that the nation's borders would be less secure if billions of dollars are yanked from the budget Friday.

"The uncertainty is already having an effect," Obama said. "Companies are preparing layoff notices. Families are preparing to cut back on expenses. The longer these cuts are in place, the bigger the impact will become."

Despite the urgent rhetoric, there was no indication the White House and congressional Republicans were actively negotiating a deal to avoid the so-called sequester ahead of the end of the week deadline.

The last known conversation between Obama and GOP leaders was last week. There have been no in-person meetings between the parties this year.

With Congress back from a weeklong recess, House Speaker John Boehner showed little willingness to move off his long-held position that the sequester be offset through targeted spending cuts, not the package of cuts and tax increases Obama supports.

"Mr. President, you got your tax increase," Boehner said, referring to the tax rate increases that took effect on Jan. 1. "It's time to cut spending here in Washington."

The $85 billion budget-cutting mechanism could affect everything from commercial flights to classrooms to meat inspections. Domestic and defense spending alike would be trimmed, leading to furloughs for hundreds of thousands of government workers and contractors.

The White House continued laying out in stark terms what the cuts would mean for government services, dispatching Homeland Security Secretary Janet Napolitano to warn of the implications for critical security functions.

"I don't think we can maintain the same level of security at all places around the country with sequester as without sequester," Napolitano said, adding that the impact would be "like a rolling ball. It will keep growing."

Interior Secretary Ken Salazar said visiting hours would be cut at all 398 national parks, just as they prepare for an influx of spring and summer visitors.

Obama will seek to build public support for his sequester offset plan today when he travels to Newport News, Va., a community that would be affected by the defense cuts.

The sequester was designed as an unpalatable fallback, meant to take effect only if a congressional supercommittee failed to come up with at least $1 trillion in savings from benefit programs.

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