Obama: US 'can't return to business as usual' with Egypt after crackdown

President Obama said that the United States "can't return to business as usual" in its relationship with Egypt given the bloody crackdown on demonstrators there that left hundreds dead earlier this month.

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"I think what most Americans would say is that we have to be very careful about being seen as aiding and abetting actions that we think run contrary to our values and our ideals," Obama said in a CNN interview airing Friday. 

"So what we're doing right now is doing a full evaluation of the U.S.-Egyptian relationship."

The president did not commit to cutting off the $1.3 billion in annual military aid provided by the United States, but reiterated that the assistance package continued to be under review. Obama met with members of his national security team on Tuesday to discuss the possibility of ending aid.

But in the interview, taped during his two-day college affordability bus tour, Obama said his sense was that "the aid itself may not reverse what the interim government does."

"At this point, we've got to take a look and see, what's in the long-term interests of the Egyptian people? What's in the long-term interests of the United States?" Obama said.

The president also expressed disappointment that factions within Egypt did not come together after former President Mohammed Morsi was removed from power by the Egyptian military earlier this summer.

"There was a space right after Mr. Morsi was removed in which we did a lot of heavy lifting and a lot of diplomatic work to try to encourage the military to move in a path of reconciliation," Obama said. "They did not take that opportunity."

The president is under increasing pressure from both parties to get tough with Egypt, which has been plagued by political unrest since the ouster of strongman Hosni Mubarak in 2011.

Obama has declined to label Morsi's ouster a "coup," which would require the U.S. to immediately suspend aid, but has condemned the violence against Morsi's supporters and the Muslim Brotherhood.