Republicans, who will take control of the House of Representatives this week, are demanding spending cuts to curb the $1.3 trillion budget deficit and several have said they would oppose a higher debt ceiling if Obama does not agree to a range of painful cuts.
White House economic adviser Austan Goolsbee accused Republicans of "playing chicken" with the nation's financial credibility.
"This is not a game. You know, the debt ceiling ... is not something to toy with," Goolsbee told the ABC News program "This Week." "If we hit the debt ceiling, that's ... essentially defaulting on our obligations, which is totally unprecedented in American history."
"The impact on the economy would be catastrophic. I mean, that would be a worse financial economic crisis than anything we saw in 2008," he said.
Without a vote by Congress to raise the limit on government borrowing, the Treasury Department could bump up against the current $14.3 trillion debt limit. Treasury has estimated the limit could be reached during the first or second quarter of this year.
Republican Rep. Michele Bachmann of Minnesota told CBS' "Face the Nation" Republicans were not looking to shut the government down but they do want to cut spending so the debt limit does not have to be raised "continually."