Obama warns looming spending cuts are 'going to take a big hit on our economy'

President Obama warned on Wednesday evening that the spending cuts set to take place at the end of the week are "going to take a big hit on our economy."

Delivering remarks before The Business Council, Obama said the so-called sequester, which will trigger $85 billion in spending cuts, will affect the steady recovery the nation has seen.

"I should point out, and I'm sure you've heard from a number of experts and economists, that this is not a cliff but it is a tumble downward," Obama said in brief remarks at the council's dinner in Washington. "It's conceivable that in the first week, the first two weeks, the first three weeks, the first month that unless your business is directly related to the Defense Department, unless you live in a town that is directly impacted by a military installation ... unless you're a family that now is trying to figure out where to keep your kids during the day because you just lost a Head Start slot, a lot of people may not notice the full impact. But this is going to be a big hit on the economy."

But Obama called the cuts "entirely unnecessary" and added, "it's not what we should be doing."

"If you look right now at what our economy needs, taking $85 billion out of over the next six months, indiscriminately, arbitrarily, without any strategy behind it, that's not a smart thing to do," he said. "What we should be doing and what I've been calling for repeatedly ... is a balanced approach to deficit reduction."

While Obama didn't call out Republicans as aggressively as he has in recent days in campaign-style events at the White House and on the road, Obama said Republicans needed to compromise "in a meaningful way" on revenues, while Democrats would have to swallow entitlement reform.

Obama invited Congressional leaders to the White House on Friday to discuss a possible compromise, and the Senate will vote Thursday on both a Democratic and Republican plan to avert the $85 billion in spending cuts, which take effect Friday.

Neither plan is expected to pass.

With Friday's deadline quickly approaching and both sides stalled over their differences, Obama — who has launched an aggressive public relations campaign to win over Americans on the issue — appeared to express uncertainty about whether a deal could be ironed out.

"Whether that can be done in the next two days, I haven't seen things done in two days here in Washington in quite some time," he said. "On the other hand, the good news is the public is paying attention to this."

Still, he added, "I think it was Winston Churchill who once said, 'Americans always do the right thing after they've exhausted every other possibility.'

"And we're now getting to the point where we've exhausted every other possibility," he said.