Entries in Debt Limit (67)


Boehner to Obama: Cuts Must Exceed Next Debt-Limit Hike

SAUL LOEB/AFP/Getty Images(WASHINGTON) -- At an address to the Peter G. Peterson Fiscal Summit late Tuesday, House Speaker John Boehner will call on President Obama to “again meet the principle of cuts greater than the hike” on any agreement to a looming debt-limit increase, which is expected during the lame-duck session after the election.

“When the time comes, I will again insist on my simple principle of cuts and reforms greater than the debt-limit increase,” Boehner, R-Ohio, will say, according to excerpts provided by his office. “This is the only avenue I see right now to force the elected leadership of this country to solve our structural fiscal imbalance. If that means we have to do a series of stop-gap measures, so be it. But that’s not the ideal.  Let’s start solving the problem. We can make the bold cuts and reforms necessary to meet this principle, and we must.”

The statutory debt-limit mandates how much money the federal government can borrow. When that cap maxes out, Congress must approve the president’s request to raise the ceiling. The bickering over the last debt-limit increase dominated the fiscal debate on Capitol Hill for most of 2010.

House Minority Whip Steny Hoyer, the No. 2 Democrat in the House, reacted by telling reporters that the dollar-for-dollar principle is “a simplistic characterization of the issue that confronts us,” and he warned that Congress could “undermine the confidence in the United States by continuing this game on the debt limit.”

“We are buying more than we’re paying for,” Hoyer, D-Md., said this morning at his weekly pen-and-pad briefing. “The Republicans are good at buying and lousy at paying. They borrowed a lot of money. As a result, we owe a lot of money. The debt limit is about paying back that which we have already incurred.”

Hoyer, who has served in the House of Representatives since 1981, called the frantic schedule of legislative deadlines at the end of the year “unlike any I have seen since I have been in Congress” and he once again reiterated his belief that both parties should strike “a big, bold, balanced deal.”

“We’ve incurred the debts, we need to pay the debts,” Hoyer said. “What we need to do in paying the debts is make sure that we have a balanced program of revenues and expenditures.”

Boehner is scheduled to deliver remarks Tuesday afternoon, when he will “lay out a path for seizing this opportunity to end the era of short-term government interventions and focus instead on reforms that promote long-term economic investment, private initiative, and freedom,” according to his office.

“We shouldn’t dread the debt limit.  We should welcome it.  It’s an action-forcing event in a town that has become infamous for inaction,” Boehner will say. “Just so we’re clear, I’m talking about real cuts and reforms, not these tricks and gimmicks that have given Washington a pass on grappling with its spending problem.”

Boehner is also expected to announce that the House will vote before the November election on a comprehensive tax overhaul to begin what he is expected to call “an expedited process by which Congress would enact real tax reform in 2013.”

“Any sudden tax hike would hurt our economy, so this fall – before the election – the House of Representatives will vote to stop the largest tax increase in American history,” Boehner will say, adding that the Ways and Means Committee will work out the details. “This will give Congress time to work on broad-based tax reform that lowers rates for individuals and businesses while closing deductions, credits, and special carve-outs.

“If we do this right, this will be the last time we ever have to confront the uncertainty of expiring tax rates,” he is expected to add. “We’ll have replaced the broken status quo with a tax code that maintains progressivity, taxes income once and creates a fairer, simpler code.”

Hoyer said he believes Boehner, who negotiated secretly with President Obama last summer on a prospective-but-failed “Grand Bargain,” could likely come to terms on a balanced, bipartisan agreement this time around. But Hoyer doubted Boehner would have the support of his rank-and-file members, telling reporters that although the rest of Republicans “believe in big and bold,” the GOP “does not believe in balance.”

“[Republicans] want tax cuts that were included in the budget for those who are doing the best in America and they want a cut to those who have less in America,” he said. “Those are not [the Democrats'] priorities. We have a substantial substantive disagreement, and we think that would be harmful to the economy, harmful to the American people and harmful to our values.”

Copyright 2012 ABC News Radio


Boehner, McConnell Announce Picks for Deficit Reduction Committee

Alex Wong/Getty Images(WASHINGTON) -- House Speaker John Boehner and Senate Minority Leader Mitch McConnell have announced the Republican contingency for the 12 member Joint Select Committee on Deficit Reduction, which is charged with identifying $1.5 trillion in deficit reduction by Nov. 23.

Boehner’s chose three of his top deputies on tax policy, the top two-ranking members of the House Ways and Means committee – Reps. Jeb Hensarling and Dave Camp, and the Chairman of the House Energy and Commerce Committee Rep. Fred Upton.

McConnell picked Sens. Jon Kyl, Pat Toomey, and Rob Portman.

Of note, Toomey -- a freshman senator, voted against the debt deal, but Kyl and Portman voted for the measure. All three House Republicans appointed by Boehner voted for the deal.

The Republican leadership’s selections follow Senate Majority Leader Harry Reid’s announcement Tuesday that he has named Sens. Max Baucus, Patty Murray and John Kerry to the bicameral, bipartisan panel. House Minority Leader Nancy Pelosi is expected to announce her appointees to the panel in the coming days.

Copyright 2011 ABC News Radio


Senate Passes the Debt Ceiling Bill -- Hours before the U.S. faced a first-ever default, President Obama signed into law a compromise deal that averts a crisis by raising the debt limit, and makes a $2.4 trillion down-payment on the federal deficit over the next 10 years.

"It's an important first step to ensuring that as a nation we live within our means, yet it also allows us to keep making key investments in things like education and research that lead to new jobs and assures that we're not cutting too abruptly while the economy's still fragile," Obama said in a statement from the White House Rose Garden before signing the bill.

Moments before his remarks, senators voted 74 to 26 to pass the Budget Control Act, the last hurdle for the controversial measure that was first approved by the House Monday night.

Obama's signature ends a bruising Washington-made crisis that has gripped the country and lifts what the administration has called a "cloud of uncertainty hanging over the economy."

"The uncertainty surrounding the raising of the debt ceiling for both businesses and consumers has been unsettling," Obama said, "and just one more impediment to the full recovery that we need, and it was something we could have avoided entirely."

But the 2011 fight over the debt and deficit is only half over, and plenty of economic uncertainty abounds.

Congress and the administration still need to agree on $1.5 trillion more in budget savings by the end of the year, a likely battle that will feature many of the same ideological and philosophical tensions that have defined the debate of the past few months.

Copyright 2011 ABC News Radio


Debt Deal Passes House: Giffords Appears on House Floor

Tom Williams/Roll Call(WASHINGTON) -- The House of Representatives decisively passed a bill tonight to raise the nation's debt ceiling, capping months of negotiation between House Republicans and President Obama.

And Rep. Gabrielle Giffords of Arizona, made her first appearance on Capitol Hill since being shot in her district in January. She voted in support of the deal that would raise the debt ceiling.

"Gabrielle has returned to Washington to support a bipartisan bill to prevent economic crisis," read a tweet from her office account as the vote was starting.

Congressional leaders breathed a collective sigh of relief Monday after convincing members of congress to support the deal, which was made public only on Sunday night to raise the nation's $14.3 trillion debt limit and avert U.S. default.

The final vote was 269-161, much more support than had been anticipated.

The compromise legislation would increase the government's borrowing power by up to $2.4 trillion through 2013, and impose nearly $1 trillion in spending cuts in 10 years, most coming out of the non-defense discretionary budget.

A new special congressional committee would be required to recommend additional deficit reduction -- that would likely include changes to entitlement programs and the tax code -- of up to $1.5 trillion by Thanksgiving. Under the deal, Congress would have to pass the recommendations into law by December or face the "trigger" of stiff, automatic cuts.

The Senate could consider the deal as early as Tuesday.

Copyright 2011 ABC News Radio


Debt Vote: Pelosi, Boehner Express Confidence to ABC's Diane Sawyer

FIle photo. Chip Somodevilla/Getty Images(WASHINGTON) -- With the House poised for a nail-biting vote to raise the debt ceiling and avoid a U.S. default, Republican House Speaker John Boehner and Democratic Minority Leader Nancy Pelosi both voiced confidence the bill can pass, despite significant public opposition from within their parties.

In an interview with ABC News’ Diane Sawyer, Pelosi said she will “absolutely” vote yes on the compromise package, even though she agreed with colleague who called it as a “Satan sandwich.”  

“It probably is – with some Satan fries on the side,” Pelosi said.

Still, Pelosi said she supports the deal – and believes a sufficient number of House Democrats will follow suit – because it meets three key criteria:  it extends the debt limit for 18 months; without any cuts to Social Security, Medicare or Medicaid; and establishes a balance of cuts between discretionary spending and defense.

Republican aides say Pelosi will need to secure at least 70 Democratic votes for the bill to pass – an outcome that is far from certain. “Where they have their comfort level, that’s where they’ll vote,” she said of her colleagues.

But when asked if it will be necessary for President Obama to come to Capitol Hill to urge Democrats to vote yes, Pelosi said, “that won’t be necessary.”

“We have to get this over with,” Pelosi told Sawyer. “We have to get to work putting people back to work. We’ve got to get on with job creation. Every day we were stuck on this negotiation we weren’t doing everything in our power to create jobs. So that’s where we have to go.”

In an earlier interview with Sawyer, Speaker Boehner signaled he’s confident the bill will pass, even though many Republicans stand fundamentally opposed to increasing the debt ceiling, or doing so without simultaneous passage of a balanced budget amendment to the Constitution.

“We got there, but we got to get the bill passed and I think we will, but so far so good,” Boehner told Sawyer.  

“I understand that some people want more, I’d like to do more, it’s not perfect,” he said, “but it is a good step in the right direction.”  

Copyright 2011 ABC News Radio


GOP, White House Debate Effectiveness of Super-Committee

MANDEL NGAN/AFP/Getty Images(WASHINGTON) -- In the midst of trying to convince Republicans to vote for the debt deal, House GOP leaders are making the case that the “Super-Committee” – charged with identifying $1.5 trillion in deficit reduction by Nov. 23 -- will have a difficult time embracing a package of tax reform leading to new revenues.

The agreement calls for a 12-member bipartisan “Super-Committee” – officially called the Joint Select Committee on Deficit Reduction – that will identify $1.5 trillion in deficit reduction.

The debt deal says that the “Congressional Budget Office shall provide estimates of the legislation…including estimates of the effect of interest payment on the debt.”

House Republicans say the reliance on the CBO means that the Super-Committee’s hands will be tied.

Tax reform might mean a new tax code where everyone’s rates are lowered, but deductions are limited or non-existent. This, Democrats hope, would raise overall revenue while also making it more palatable to the public.

The White House says that as an added incentive for the Super-Committee to act – in addition to the onerous “triggers” the legislation calls for – the president will veto any further extension of the Bush tax cuts for the top two brackets when they next expire in January 2013. The president’s argument is: Make a new tax code that makes the Bush tax cuts irrelevant.

Republicans say since the Bush tax cuts are set to expire, the CBO is already anticipating and assuming $3.5 trillion in new revenue.

A senior White House official told ABC News the legislation “is no obstacle to revenue-raising tax reform. And the President will be making the case that this should be part of a balanced deal coming out of the Joint Committee.”

Copyright 2011 ABC News Radio


Debt Compromise Reached, but Will US Lose Its Credit Rating? 

ABC News(NEW YORK) -- Now that Congressional leaders and the president have struck a budget deal that, if passed by Congress, would prevent the U.S. government from defaulting, the country's pristine credit rating could still suffer a blow, raising the specter of an interest rate spike and a devastating ripple effect throughout the economy.

Earlier this month, the credit rating agency Standard & Poor's warned that the U.S. risked a downgrade to AA status if Congress doesn't lift the debt ceiling and reduce the total debt by $4 trillion over the next decade. Unfortunately, that risk remains even if the deal manages to navigate a rocky road through  Congress.

Viewed by politicians and pundits alike as overstepping, Standard & Poor's has come under fire for playing politics, and, some charge, they and other credit agencies should not wield so much power to determine the financial future of the country, particularly given the role they played in the credit crisis.

In a rare interview, the man who heads the global team at Standard & Poor's told ABC News' Jim Sciutto that reaching an agreement in Congress on a debt ceiling increase is hardly the "end of America's budgetary problems."

"If America keeps on doing what it's doing, which is having deficits of the kind it has at the moment, clearly, it's going to be looking out of place in that AAA-rated peer group," said Paul Coughlin, executive managing director of corporate and government ratings.

Asked if his company is interfering in politics, Coughlin told ABC News last week that Standard & Poor's is doing what ratings agencies do. "We are making real world observations about risk," he said. "We're just a rating agency, we just grade debt according to its relative safety or riskiness."

In the case of the U.S. government, which is rated at the top of the scale, he said, ratings agencies are looking to see how much "buffer of safety is there."

Copyright 2011 ABC News Radio


White House Confident Debt Deal Will Pass

Official White House Photo by Pete Souza(WASHINGTON) -- White House Senior Advisor David Plouffe says the White House is confident the debt deal will pass.

He says, “every member is going to have to make their own determination...We’re confident that this deal will and should pass.”

Obama received criticism for his own party who claim he gave into too many GOP demands. New York Times columnist Paul Krugman, even accused the president of “abject surrender” in reference to extending Bush tax cuts and the threat of a government shutdown in the spring.

Plouffe, however, denied that the president gave up too much stating:

“These are spending cuts that, you know, were identified largely on the front-end through the work the president and vice president did with the Congressional leaders.  They protect things like education, like medical research and this Committee is going to be charged, again, with doing the next stage but the enforcement mechanism, obviously, we wanted to do something that we thought protected the most vulnerable and that’s what this enforcement mechanism would do.”

ABC’S Jonathan Karl reports that 11 Senate Republicans are poised to vote no on the debt deal.  That should set up passage in the Senate with 70-plus votes, depending on how many Democrats vote no.

However, the House of Representatives is less likely to pass the deal. Tea Party favorite Rep. Allen West, R-Fla., sounded positive Sunday night, but 38 other House Republicans signed a pledge promising not to vote for any debt ceiling increase unless Congress first passes a balanced budget amendment.  

And there will be many other Republican no votes in the House. In fact, Republican no votes are likely in the 80 to 100 range, which means 76 Democrats must vote yes for the deal to pass.

Copyright 2011 ABC News Radio


Obama Announces Congress Has Reached Debt Ceiling Agreement

Jim Watson/AFP/Getty Images(WASHINGTON) -- President Barack Obama on Sunday night announced that Congress had arrived at an 11th-hour bipartisan deal to raise the nation's debt ceiling and prevent an unprecedented United States default on its financial obligations. 

The deal, which Obama said was not the one he'd sought but which nonetheless required both Republicans and Democrats to make painful compromises, increases the U.S. debt limit by at least $2.1 trillion through 2013.

The plan also includes a trillion dollars in spending cuts, and creates a congressional commission to come up with another $1.5 trillion in cuts by November 23, largely through tax and entitlement reform. 

If that November deadline is not met, the president said, automatic cuts go into effect.  Those include $1.2 trillion in cuts to domestic and defense programs, but reportedly would not include cuts to Social Security, Medicare beneficiaries and programs for low-income Americans.

"This compromise does make a serious down payment on the deficit reduction we need and gives each party a strong incentive to get a balanced plan done before the end of the year," the president declared.

Copyright 2011 ABC News Radio


GOP Leaders: ‘It’s Time for the President to Tell Us What He’s For’

ABC News(WASHINGTON) -- Moments after the House of Representatives voted to reject Senate Majority Leader Harry Reid’s plan to increase the debt limit, Congress’s top-two ranking Republicans say President Obama must now enumerate a legislative solution to the looming financial crisis that he will sign into law.

“It’s time for the president to tell us what he’s for,” House Speaker John Boehner, R-Ohio, said at a joint news conference with Senate Minority Leader Mitch McConnell. “It’s time for the president to outline how do we get out of this cul-de-sac that he’s driven us into.”

“We all know that if the president decides to reach agreement with us, the Democrats – most of them – will fall in line,” McConnell, R-Kentucky, added. “He is leader of the Democratic Party. He is the president of the United States. He needs to indicate what he will sign and we are in those discussions now.”

Although the Senate will not vote on the Reid proposal until early Sunday morning, Boehner said that this afternoon’s vote in the House “indicates there’s bipartisan opposition to Senator Reid’s proposal.” Boehner also said that Congress could have passed the Boehner plan last week but “the only thing standing in way of the House proposal over in the Senate is the president and Senator Reid.”

McConnell also predicted that a vote on the Reid plan will fail early Sunday morning, and he revealed that he had spoken to both the president and the vice president Saturday afternoon to begin the process of finalizing an agreement.

Earlier Saturday, the House of Representatives voted 173-246 to defeat Reid’s version of a plan to increase the debt limit by $2.4 trillion along with $2.4 trillion in cuts. No Republicans voted in favor of the legislation while 11 House Democrats voted against it. The bill required a two-thirds majority to pass because it was moved to the floor under the rules of suspension.

The House adjourned shortly after the vote at 3:16pm and will be in a pro forma session Sunday with no votes expected.

Still, the two GOP leaders did their best to assure the public that the deadline will not pass without a deal to raise the debt ceiling in place.

Copyright 2011 ABC News Radio

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