|
|
Debt talks shift gears as leaders develop new plan - Tucson Citizen
WASHINGTON – Congressional leaders raced Saturday to develop a new strategy for raising the federal debt limit that House Speaker John Boehner told his troops would include an ambitious plan to reduce future borrowing by as much as 4 trillion. Although his talks with President Barack Obama over a “grand bargain” to restrain the national debt collapsed in acrimony Friday, Boehner, R-Ohio, said in a conference call with House Republicans that he is confident lawmakers will avert a historic U.S. default – a possibility just 10 days off. “Over this weekend,” Boehner said in a statement, “Congress will forge a responsible path forward.” Boehner and other leaders started their day at the White House, where Treasury Secretary Timothy Geithner warned of possible trouble in the markets if policy makers don’t announce a viable plan for raising the debt limit before Asian exchanges open Monday morning (this evening in the U.S.), according to people familiar with the meeting. Aides said Geithner’s warning lent fresh urgency to the negotiations, which continued throughout the day on Capitol Hill. By early evening Saturday, the outlines of a two-stage strategy were emerging. First, lawmakers would vote on a package to cut agency spending by as much as 1 trillion over the next decade and raise the debt limit, currently set at 14.3 trillion, by the same amount. That would give Geithner enough borrowing authority to cover the nation’s bills through the end of this year. Then Congress would go to work to produce as much as 3 trillion in additional savings through an overhaul of the tax code and major changes to Social Security and Medicare. Policy <a href="http://www.sogocheap.com/"><strong>cheap jeans</strong></a> makers were still haggling over the process. One option is creating a new bipartisan debt-reduction committee composed of 12 lawmakers representing both the House and Senate, an idea offered this month by Senate Majority Leader Harry Reid, D-Nev. Another option is directing existing committees in Congress to make tax and entitlement changes aimed at meeting specific savings targets. The two parties remained at odds, however, over how to force Congress to produce the second round of savings. Boehner proposed making the next debt-limit vote contingent on a plan to reduce future borrowing. But Democrats were insisting on a plan that would postpone another debt-limit showdown until after the 2012 presidential election. Boehner, Reid, Senate Minority Leader Mitch McConnell, R-Ky., and House Minority Leader Nancy Pelosi, D-Calif., met briefly in Boehner’s office Saturday evening to try to resolve the issue. They emerged without a fresh approach to the problem, but Democratic aides described the meeting as productive and said the two sides agreed to keep working to produce a plan today. Obama has repeatedly objected to a short-term debt-limit extension, arguing that it would invite the same high-stakes gridlock that now threatens the sputtering U.S. recovery, as well as global markets. The president made that case again Saturday morning when Boehner, Reid, McConnell and Pelosi gathered at the White house for an hourlong session. Obama called the meeting after Boehner walked out Friday on debt-limit talks with the White House for the second time in two weeks – again citing differences on taxes. “A short-term extension could cause our country’s credit rating to be downgraded, causing harm to our economy and causing every American to pay higher credit-card rates and more for home and car loans,” White House spokesman Jay Carney said in a statement later. “As the current situation makes clear, it would be irresponsible to put our country and economy at risk again in just a few short months with <a href="http://www.sogocheap.com/wholesale-48-b0-Supra-Shoes.html"><strong>Supra Shoes</strong></a> another battle over raising the debt ceiling.” In the meeting, Pelosi supported the president. Reid later issued a statement saying he, too, would oppose a short-term deal. “We seek an extension of the debt ceiling through at least the end of 2012,” Reid said. “We will not send a message of uncertainty to the world.” In his conference call with Republican lawmakers, however, Boehner made clear that a short-term extension is among the options on the table, participants said. And he appeared to rule out the most likely alternative to a short-term deal: a process proposed by McConnell this month that would authorize Obama to raise the debt limit in three installments without explicit congressional approval. “The goal of our discussions now with the leaders is not to do something in the Reid-McConnell framework,” Boehner said, according to one participant. “It will be something new.” A senior GOP aide, meanwhile, accused Obama and other Democrats of trying to shape the debt-limit debate to suit their political needs. “It would be terribly unfortunate if the president was willing to veto a debt-limit increase simply because its timing would not be ideal for his re-election campaign,” the aide said, speaking on the condition of anonymity to discuss Boehner’s strategy. “We want the most significant deficit-reduction possible, but linking the full faith and credit of the United States to presidential campaign politics is not a defensible position.” Aides said McConnell, too, is not inclined to replay the current crisis at the end of the year. Meanwhile, there were lingering doubts about Boehner’s ability to rally support for a debt-limit increase of any size among House Republicans, many of whom continue to push their plan to sharply cut spending over the next decade and adopt a constitutional amendment requiring Congress to balance the budget. Such a plan passed the House but failed Friday in the Senate on a party-line vote. Freshman Rep. Blake Farenthold, R-Texas, said Republican leaders remain concerned that even a small increase in the debt limit would fail on the House floor. “I think their concern about bringing it to the floor is whether they can get 218 (votes) or not,” Farenthold said. “Everybody wants to only go through this pain once.” Polls indicate that raising the debt limit is hugely <a href="http://lnx.u2place.net/u2foto/displayimage.php?album=random&cat=0&pos=-4094"><strong>A Mens K5 Blazer Makes Getting Dressed Easy | At The Bonfire</strong></a> unpopular among voters, although leaders of both parties have argued that it is essential to protecting the value of the dollar and the strength of the U.S. economy. The Treasury is due to run short of cash to cover the nation’s bills on Aug. 2 without additional borrowing authority. All three major rating agencies have threatened to downgrade the United States if the debt limit is not raised. The current AAA rating identifies U.S. Treasury bonds as one of the world’s safest investments – and has helped the nation borrow at extraordinarily low rates. So far, the market for Treasury bonds has shown little distress over the possibility of a U.S. default. Interest rates have remained extremely low even when negotiations in Washington over raising the debt ceiling have broken down. This entry was posted on Sunday, July 24th, 2011 at 12:00 am and is filed under Arizona Republic News. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.
|
Buildings in
Linear Mode
