Entries in Debt Reduction (9)


Obama on Debt Deal Failure: GOP 'Refused to Listen'

ABC News(WASHINGTON) -- President Obama said Monday he will veto any efforts to get rid of the automatic spending cuts that will be triggered by the supercommittee’s failure to reach a bipartisan solution to deficit reduction.

“There will be no easy off-ramps on this one. We need to keep the pressure up to compromise, not turn off the pressure,” the president said Monday evening. “The only way these spending cuts will not take place is if Congress gets back to work and agrees on a balanced plan to reduce the deficit by at least $1.2 trillion.”

The $1.2 trillion in cuts that will be triggered are divided equally between social programs and defense spending. Republicans have dubbed the defense cuts “draconian” and, following news of the supercommittee’s failure, said they are now working on a plan to minimize the impact of the sequester on the Department of Defense.

But the president on Monday flatly said he won’t accept any such deal and urged the two sides to continue working on an agreement.

He squarely placed the blame on Republicans for failing to come together on the deal that was to have been inked by midnight Monday.

“There are still too many Republicans in Congress who have refused to listen to the voices of reason and compromise that are coming from outside of Washington,” Obama said. "At this point, at least, they simply will not budge from that negotiating position....That refusal continues to be the main stumbling block.”

The co-chairs of the supercommittee, Rep. Jeb Hensarling, R-Texas, and Sen. Pat Murray, D-Wash., said they were “deeply disappointed” by the lack of a deal to cut $1.2 trillion from the budget.

“After months of hard work and intense deliberations, we have come to the conclusion today that it will not be possible to make any bipartisan agreement available to the public before the committee’s deadline,” the two said.

But they pledged to continue the talks.

“I knew that it would be hard to do,” Murray told reporters. “I think we all know that our country is divided. Certainly the committee had different philosophies....I am disappointed tonight that things I cared about deeply, which is getting our country back on track and making shared sacrifice, aren’t the result of this committee’s hard work.”

Tax cuts were one of the biggest dividing factors between the two sides.

House Speaker John Boehner, R-Ohio, steered clear of playing the blame game, only saying that “the House will forge ahead with the commitments.”

Sens. John McCain, R-Ariz., and Lindsey Graham, R-S.C., said they are now working on a plan to minimize the “draconian” impact of the sequester on the Department of Defense, which will bear half of the $1.2 trillion in budget cuts.

The cuts would begin in 2013, when the Congressional Budget Office estimates that the Defense Department would have to slash 10 percent, or about $550 billion, from its budget. Combined with the $450 billion worth of cuts already planned, that would amount to $1 trillion in the next decade.

“These cuts represent a threat to the national security interests of the United States, and cannot be allowed to occur,” McCain and Graham said.

Copyright 2011 ABC News Radio


Supercommittee Fails to Reach Bipartisan Deal

Medioimages/Photodisc(WASHINGTON) -- The co-chairs of the supercommittee tasked with finding a bipartisan solution to deficit reduction said Monday afternoon that the group has failed to reach an agreement.

“After months of hard work and intense deliberations, we have come to the conclusion today that it will not be possible to make any bipartisan agreement available to the public before the committee’s deadline,” co-chairs Rep. Jeb Hensarling, R-Texas, and Sen. Patty Murray, D-Wash., said in a statement.

“Despite our inability to bridge the committee’s significant differences, we end this process united in our belief that the nation’s fiscal crisis must be addressed and that we cannot leave it for the next generation to solve,” the statement said. “We remain hopeful that Congress can build on this committee’s work and can find a way to tackle this issue in a way that works for the American people and our economy.”

“We are deeply disappointed that we have been unable to come to a bipartisan deficit reduction agreement, but as we approach the uniquely American holiday of Thanksgiving, we want to express our appreciation to every member of this committee, each of whom came into the process committed to achieving a solution that has eluded many groups before us. Most importantly, we want to thank the American people for sharing thoughts and ideas and for providing support and good will as we worked to accomplish this difficult task.”

There were early signs that the Super Committee would not be able to reach an agreement, but there was a last-minute effort by a few members of the committee to salvage something.

A bipartisan group comprised of Sens. Jon Kyl, R-Ariz., John Kerry, R-Mass., and Rob Portman, R-Ohio, met in the Capitol Monday afternoon. Senate aides said Kerry and Kyl also spoke earlier Monday morning.

But the two sides failed to come together despite a show of optimism.

Kyl, who had indicated that the talks were not fruitful, said Monday morning that the result of the Super Committee is one of the biggest disappointments of his career. Kyl is retiring at the end of his term.

Copyright 2011 ABC News Radio


Harry Reid: John Boehner's Plan is 'Dead on Arrival' in Senate

Reid dot Senate dot gov(WASHINGTON) -- Senate Majority Leader Harry Reid, D-Nev., Tuesday said that Speaker of the House John Boehner’s plan is “dead on arrival” in the Senate and attempted to define what a vote for the House plan would be: a vote for the Tea Party.

“Speaker Boehner's plan is not a compromise. It was written for the Tea Party, not the American people. Democrats will not vote for it. Democrats will not vote for it. Democrats will not vote for it. It's dead on arrival in the Senate, if they get it out of the House," Reid said following a meeting with his caucus Tuesday. “I hope my Republican colleagues will think long and hard about what direction they want to move. They can either support the Tea Party, that -- and their plan, which has no chance of passing, or they can work with us to forge a responsible approach.”

The effort right now in the Senate, Reid said, is for Democrats to rally support with their Republican colleagues for the Senate plan.

“We decided that members of our caucus would start reaching out to our Republican colleagues to encourage them to support our plan. The Senate plan is a reasonable middle ground,” Reid said, “Even Grover Norquist gave his blessing to our plan today -- opening the door, I hope, for Republicans to vote with us.”

And Reid suggested that the Gang of Six will be reaching out and perhaps influencing his plan as well as a way to pick up more votes.

The majority leader said he’s open to compromise but the Democrats will not compromise on the length of the extension of the debt ceiling, one of the key sticking points between the dueling plans.

“We are not going to have a short-term extension of this debt because it would mean that we would come back in early October and be right where we are again -- the same, same deal.”

When asked, Reid said that he believes that Speaker Boehner would like to avoid default but noted that “he sure has a funny way of showing it."

Copyright 2011 ABC News Radio


'Stalemate': Obama Calls for Compromise; Boehner Holds Firm on Spending Cuts

SAUL LOEB/AFP/Getty Images(WASHINGTON) -- With the U.S. government hurtling toward an Aug. 2 deadline to avoid first-ever default, President Obama and House Speaker John Boehner squared off on national television, making their separate cases about how to go about deficit reduction and raise the debt ceiling.

The two issues are tied together in the current Washington debate, Republicans insisting that any increase in the nation’s credit limit be accompanied by equal spending cuts.

President Obama, speaking first from the White House, described a “stalemate” between the two parties and encouraged citizens to call Congress and encourage lawmakers to work together.

"I've told leaders of both parties that they must come up with a fair compromise in the next few days that can pass both houses of Congress and a compromise that I can sign. I'm confident that we can reach this compromise."

It is hard to see where the compromise will come. President Obama argued forcefully against deficit reduction that relies solely on cuts to government spending.

Boehner used his rejoinder from Capitol Hill to argue against runaway government spending, which he said has been “business as usual” in Washington.

While President Obama pointed to the tax cuts and wars begun under President Bush that started a snowball of debt, Boehner pinned blame on President Obama.

“Here's what we got for that spending binge: a massive health care bill that most Americans never asked for.  A 'stimulus' bill that was more effective in producing material for late-night comedians than it was in producing jobs.  And a national debt that has gotten so out of hand it has sparked a crisis without precedent in my lifetime or yours,” Boehner said.

He also said the president changed course late last week in negotiations --  demanding $400 billion in new tax increases for deficit reduction instead of the $800 billion that had already been agreed upon. That was a bridge too far for Boehner.

“I gave it my all,” the House speaker said, without referencing the details. “Unfortunately, the president would not take yes for an answer.  Even when we thought we might be close on an agreement, the president’s demands changed.”

But President Obama said “a little debt is manageable,” although he admitted that the government debt is out of control. To that end, he said Democrats would agree to painful spending cuts and reforms to Medicare, Medicaid and Social Security. But he argued forcefully that deficit reduction should not be spending cuts alone and implied that it is Republicans who need to give in on demands. In broad strokes he outlined the deal that he and Boehner were close to inking last week -- nearly $4 trillion in deficit reduction over a decade with spending cuts, entitlement reform and some increased taxes.

Obama said the economy cannot bear to have this debate again in six months and that is why he said he opposes a short-term debt ceiling increase backed by many Republicans. President Obama wants to delay another argument on the debt ceiling until 2013, which is also after the next presidential election.

At this point, Republicans are pursuing a plan in the House and Democrats are pursuing their plan in the Senate.

Republicans are rallying around a proposal written by John Boehner that would raise the debt ceiling, but only by about a $1 trillion. President Obama has said he would veto such a plan. The debate has been difficult and all-consuming for Washington and there is concern that having it again in one year could hurt the economy. It would also instantly become a top issue in the presidential campaign. Democrats have insisted that any debt ceiling increase last until 2013.

Earlier Monday the White House made clear it will support the plan written by Democrat and Senate Majority Leader Harry Reid. His proposal is to cut more than $2 trillion in spending, including money saved through the planned drawdown of the wars in Iraq and Afghanistan -- a move Republicans dismiss as not really cutting spending -- although those savings are also featured in a GOP Budget draft that passed the House earlier this year.

Copyright 2011 ABC News Radio


Reid Begins Process to Move His Bill to the Floor, But Does Not File Cloture

Architect of the Capitol(WASHINGTON) -- Senate Majority Leader Harry Reid, D-Nev., did not file cloture, as expected, on his debt plan Monday night on the Senate floor, which means that there will not be a midweek vote on his proposal.

Instead, Reid used a procedural move called “filling the tree” which blocks Republicans from offering amendments to his plan.  It is in essence a procedural lock which sets up a vote later in the week, without a specific deadline. It may have been used to force Speaker of the House John Boehner’s plan to be voted on in the House first.

“We have put into process our efforts, sound legislation to end the budget crisis we’re in. It in effect does everything the Republicans have asked,” Reid said on the Senate floor Monday evening. “Virtually everything we have in there has been suggested by the Republicans. And now they need to take yes for an answer. Give a yes.”

On Monday evening Reid convened with the Democratic caucus, in which he briefed his fellow Democrats about his plan. Leaving the meeting Monday night, Senate Democrats appeared to be trying to show a united front in support of Reid’s plan.

Sen. Kent Conrad, D-N.D., said that the Reid plan was received “extremely well” by the caucus.

"The Reid plan is a realistic way forward," Conrad said. "And you know there's obviously got to be at some point further agreement."

“We’re going to pass ours,” Sen. Dick Durbin, D-Ill., said. "That’s our goal....there’s a feeling now that we have to stand together.”

Can it get 60 votes to pass, though? “Well it depends on the Republicans,” Durbin said. “It still comes down to that.”

Copyright 2011 ABC News Radio


Reid Unveils $2.7 Trillion Debt Plan: 'We Are Giving (GOP) What They Want'

ABC News(WASHINGTON) -- And the showdown over the dueling deals continues on the Hill Monday.
While Speaker of the House John Boehner, R-Ohio, was briefing his caucus on his debt plan, on the other side of Capitol Hill, Senate Majority Leader Harry Reid, D-Nev., briefed press on the Senate’s competing package, which he will bring to the Senate floor formally Monday night.
The undercurrent of every point Reid made, along with Sen. Charles Schumer, D-N.Y., by his side, is that each detail of this deal is something that Republicans have already agreed to and thus this is, in their view, the offer that Republicans cannot refuse.

“We are giving them what they want,” Reid spun his plan. “This proposal satisfies Democrats core principles by protecting Medicare, Medicaid and Social Security and providing a long-term extension of the debt ceiling that the markets are looking for. The bill also meets Republicans demands -- two major demands: it contains no revenues and the amount of the cuts meets the amount of the debt ceiling increase.”

“If they oppose this -- why?” Sen. Schumer said of Republicans. “It’s everything they asked for.”
“This is a very hard decision for many on our side,” Schumer continued. “Our side knows that any serious deficit plan must include revenues, but in the interest of preventing a default, you can have the fight on revenues later.” Schumer said at this point there is “no alternative” other than default.
Reid’s $2.7 trillion plan would include $1.2 trillion in discretionary spending cuts, including both defense and non-defense spending.
The proposal outlines $100 billion in mandatory savings -- none of which would impact Medicare, Medicaid or Social Security.  The savings would come from:
-$40 billion in Program Integrity Savings -- reducing and abuse in mandatory programs such as Continuing Disability Reviews and SSI redeterminations, Internal Revenue Service tax enforcement, health care fraud and abuse control and Unemployment Insurance improper payment reviews.
-30 billion in Fannie Mae/Freddie Mac Reforms
-$15 billion in Spectrum Sales and Universal Service Fund Reforms
-$10-15 Billion in Agricultural Reforms
-Higher education program reforms whose savings go to sustain the Pell Grant Program
There would be an additional $1 trillion in “winding down” the war in Iraq and Afghanistan.  Democrats, who know Republicans are critical of this calculation, pushed back Monday -- noting that Paul Ryan’s budget in the House also included these savings in the deficit reduction calculation.
There would be $400 billion in interest savings -- $220 from the discretionary spending cuts and $180 billion from “winding down” the wars in Iraq and Afghanistan.
The plan also establishes a Joint Congressional Committee to find future savings – made up of 12 members to present options for future reduction.
The Reid plan contains no tax increases.

Copyright 2011 ABC News Radio


No Deal: Debt Ceiling Talks Between Obama, Boehner Break Down

The White House(WASHINGTON) -- Talks between House Speaker John Boehner and President Obama to raise the debt ceiling in conjunction with sweeping spending cuts and tax and entitlement reform have broken down. There will be no "grand bargain" to deal with the debt crisis and raise the debt ceiling.

Boehner's decision to abandon negotiations with President Obama puts an end to a deal that would have cut spending by up to $3.5 trillion over the next 10 years and increased tax revenues by close to a trillion dollars. But the $14.3 trillion debt ceiling must be raised by Aug. 2 to avoid a government default.

"We have now run out of time," a visibly angry Obama declared at a hastily arranged press conference in the White House briefing room.

He said he has summoned Boehner, House Minority Leader Nancy Pelosi, Senate Minority Leader Mitch McConnell and Senate Majority Leader Harry Reid to the White House for an emergency meeting at 11am on Saturday.

"I expect them to have an answer as to how they will get this thing done over the next week," Obama said. Both sides agree that a proposal should be hammered out over the weekend.

Talks now begin between Boehner and senate leaders on a far less ambitious a Plan B.

Boehner held his own press conference Friday night and said the talks broke down because "The White House moved the goal posts."

Specifically, he said the two sides had agreed on an unspecified amount of revenue to be included in deficit reduction, achieved by broadening the number of Americans who pay taxes and lowering general tax rates. But he said President Obama on Thursday demanded another $400 billion in revenue, which Boehner said "was going to be nothing more than a tax hike on the American people."

Copyright 2011 ABC News Radio


Gang of Six Meets to Discuss the Next Steps

Senator Kent Conrad. US Senate(WASHINGTON) -- The Gang of Six, plus two self-professed “cheerleaders,” huddled late Tuesday afternoon behind closed doors after their plan had some time to breathe on Capitol Hill, in an attempt to figure what the next step is as the clock ticks closer to Aug. 2.

The next step: members of the Senate will be asked to sign a letter supporting the “basic direction” of the Gang of Six’s plan.  There will be another meeting Wednesday with the group to discuss how the plan may be advanced.

Members of the Gang of Six did not immediately shoot down the idea that their plan could be attached in some way to the plan being worked on by McConnell and Reid.

“It is possible,” Senator Kent Conrad, D-N.D., said after leaving the meeting. “One possibility that is being discussed is that this special congressional committee would have this as a fallback or maybe the basis of their discussions.”

At the same time, they are trying to draft the plan legislatively so it can be considered.

Conrad admitted that they know the time frame is working against them. “That’s a problem. As you know scoring of these things can take an extended period. I know CBO told the Democratic Leader that just the mandatory spending piece from the White House talks could take as long as two weeks to score. So all of these issues are being discussed and considered.”

Copyright 2011 ABC News Radio


White House Compares 'Cut, Cap and Balance Act' to 'Ryan Plan on Steroids'

Medioimages/Photodisc(WASHINGTON) -- Following the president’s veto threat Monday morning, senior White House officials launched a full-on assault against the Republican “Cut, Cap and Balance Act” Monday afternoon, describing it as “extreme, radical, and unprecedented.”

On a conference call with reporters Monday, White House Communications Director Dan Pfeiffer said the legislation “essentially enshrines into the constitution the Ryan plan on steroids.”

“Unless House Republicans are willing to raise revenues, significant revenues, something they have refused to do, it would require much deeper spending cuts than in the Ryan plan. This would result in even more devastating cuts to clean energy, education and health care for children and people with disabilities,” Pfeiffer said.

In addition to cutting spending in fiscal 2012 by $111 billion and capping future spending at 19.9 percent of GDP, the bill would require that a Balanced Budget Amendment be approved by Congress and sent to the states in order for the debt ceiling to be increased.

“This is equivalent to holding the debt limit hostage,” Deputy Director of the National Economic Council Jason Furman said on the call.

Pfeiffer reiterated that the president believes compromise, not a constitutional amendment, is needed to get the nation’s fiscal house in order.

Copyright 2011 ABC News Radio

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