Obama's comments come as the president prepared to meet separately with Senate Democratic and Republican leaders Monday to attempt to revive negotiations that collapsed Thursday when Republicans walked out over Democrats' demands for tax hikes.
"Of course, there's been a real debate about where to invest and where to cut, and I'm committed to working with members of both parties to cut our deficits and debt," Obama said in his weekly radio address. "But we can't simply cut our way to prosperity," he added.
Obama said the nation still needed to invest in education, infrastructure and developing new technologies to grow the U.S. economy.
Lawmakers have been working to hash out a deal to lower budget deficits and raise the U.S. debt limit. The federal deficit now stands at $1.4 trillion, among the highest levels relative to the economy since World War Two.
The $14.3 trillion U.S. debt ceiling must be increased before Aug. 2 or the Treasury Department will run out of money to pay the country's bills.
A default on debt payments could send markets plunging around the world and raise the risk of another U.S. recession.
Republicans and Democrats have clashed over the composition of the deficit reduction package, with Republicans opposing any tax increases and Democrats saying they will not support a package that relies only on spending cuts.
Conservatives in Congress, including many Tea Party activists who are credited with winning the House for Republicans in the 2010 election, have questioned whether there really is a pressing need to increase the debt limit.