Debt ceiling debate: Obama stakes out position

America is "not a deadbeat nation", US President Obama has said, warning Republicans not to hold the economy to ransom on the federal borrowing limit.

He told a White House news conference it would be "absurd" to use the debt ceiling as a negotiating chip.

Republican House Speaker John Boehner said a debt ceiling rise should be accompanied by spending cuts.

The US is expected to hit its $16.4tn (£10.2tn) borrowing limit by February unless lawmakers act.

Monday's press conference came a week before the inauguration ceremony in Washington DC that will begin Mr Obama's second term.

Mr Obama had previously said he wanted a permanent extension of the debt limit as part of a deal to avoid those spending cuts which, combined with a package of tax rises, was known as the fiscal cliff.

A last-minute deal in Congress avoided most of those tax rises and deferred the spending cuts by two months, but the debt ceiling limit was not part of the negotiations.

In preparation for the debt ceiling fight, Treasury Secretary Timothy Geithner has already cut payments into the pension and disability fund for government workers and to the health benefits fund of postal retirees.