Barack Obama signs debt deal into law

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US President Barack Obama on Tuesday signed into law a new bill, which would raise the nation's debt ceiling and avoid a default by the world's top economy, the White House said.

Obama signed the bill shortly after it passed the Senate by 74-26 votes, a day after it cleared the House of Representatives by an overwhelming 269-161 margin.

White House spokesman Jay Carney told reporters "the president has signed the bill and turned it into law."

JOB AID

Barack Obama urged lawmakers to focus next on boosting the US economy with measures to aid job creation so businesses can once again hang out the "now hiring" sign.

"We can't balance the budget on the backs of the very people who have borne the biggest brunt of this recession," Obama told journalists just after Senate passed a deal to raise the nation's debt ceiling.

"Everyone has to chip in. It's only fair. That's the principle I'll be fighting for during the next phase of this process," Obama said in a statement in the White House's Rose Garden.

He was speaking just minutes after Senate approved legislation to avert a disastrous debt default and cut trillions in government spending, sending the bill to Obama to sign into law after weeks of bruising in-fighting.

Lawmakers voted 74-26 to pass the measure -- which cleared the House of Representatives by an overwhelming 269-161 margin a day earlier -- with just hours to spare before a midnight (0400 Wednesday) deadline.

Obama signed the legislation into law Tuesday. It lifts cash-strapped Washington's $14.3 trillion debt limit by up to $2.4 trillion while cutting at least $2.1 trillion in government spending over 10 years.

Republicans have promised the spending cuts will create jobs, but top Wall Street economists have warned the austerity measures will actually be a drag on already sluggish US growth even as government stimulus measures run out.

"In the coming months," Obama vowed, "I'll continue also to fight for what the American people care most about. New jobs, higher wages, and faster economic growth."

He rolled out a list of measures which he said he hoped US lawmakers would focus on once they return from their recess in September to inject fresh life into the economy with unemployment still hovering around 9.2 percent.

Cutting red-tape on patents which has strangled small businesses, giving loans to private companies to repair the nation's infrastructure, and passing a series of trade deals stalled in Congress were some ways of stimulating the economy, he said.

"We have workers who need jobs and a country that needs rebuilding," he said proposing the idea of creating an infrastructure bank to provide such loans to small businesses.

US lawmakers needed to put the bitter wrangling aside and after their vacation "immediately take some.. bipartisan steps that will make a difference," Obama said.

"Both parties share power in Washington and both parties need to take responsibility for improving this economy," he insisted.

"Voters may have chosen divided government, but they sure didn't vote for dysfunctional government. They want us to solve problems. They want us to get this economy growing and adding jobs."

He also again stressed the need for tax reform, and called for extending tax cuts for middle class families "so you have more money in your paychecks."

Obama insisted there needed to be tax reform "so that the wealthiest Americans and biggest corporations pay their fair share."

The president also highlighted the need to eliminate taxpayer subsidies to oil and gas companies and closing tax loopholes -- something that his Republican rivals resisted during the protracted, bitter debt deal negotiations.