Sen. Graham 'Very Worried' on Whether Debt Deal Can Be Reached

ABC News(WASHINGTON) -- As Congress and the president try to strike a deal to cut spending and raise the debt ceiling, one Republican Senator tells ABC News that prospects look bleak.

“Right now I’m very worried,” Sen. Lindsey Graham (R-S.C.) told ABC News.  “If I were a betting man, I’d bet no [deal].”

Sen. Graham said Republicans should be willing to accept a deal that curbs entitlement spending and increases tax revenues by closing loopholes.

“To me, that makes sense,” he said.  “That way you don't raise tax rates, but you do generate new revenue by closing loopholes.  You're giving money away to a few people at the expense of many, and I think it's time to reevaluate that.”

The obvious solution, Graham said, is for Republicans to give some ground on taxes and for Democrats to give some ground on entitlements.  But he doubts negotiators will get there before Aug. 2.

“How to get there from here?” Graham said.  “The president says he’s not going to do a short term extension.  [Republicans] are saying we aren’t going to generate any new revenue.  [Democrats] are saying they aren’t going to do it without revenue.  Well, somebody’s got to blink.”

Graham may be right.  Even as the Congressional leaders met Tuesday at the White House, key players in both parties said the debt ceiling talks had reached an impasse over irreconcilable differences on both taxes and spending.

One top Democratic aide predicted it will take a market crash or near-crash to break the impasse, while a top Republican aide said, “It’s even doomier and gloomier than you think.”

Copyright 2011 ABC News Radio


Boehner on US Debt Default: 'You Could Have a Real Catastrophe'

SAUL LOEB/AFP/Getty Images(WASHINGTON) -- When asked on Tuesday by Brett Baer on Fox News what will happen if Republicans and Democrats don't agree on a deal to raise the debt ceiling, Speaker of the House John Boehner paused rather dramatically and replied, “I don’t know.”

“I don’t think anybody in the world really believes that the United States is going to default on our debt,” Boehner said.  “But given what is going up in Europe, something could spook the market, missing Aug. 2 could spook the market and you could have a real catastrophe.  Nobody wants that to happen.”

Even so, Boehner said, Republicans will continue to push for big spending cuts.

“As dangerous as that may be, I still think that is the time to do this,” Boehner said.  “Making the tough decisions today, not kicking the can down the road is the right thing for this country.”

Boehner placed blame for the impasse on the White House and Congressional Democrats.

“I think the president is trying -- he’s trying to get there," he said.  "But their insistence on us raising taxes is continuing to prevent us from getting this done.”

Asked if he trusts the president, Boehner replied, “I do.”

As for the president’s comments on Social Security checks being in jeopardy beginning on Aug. 3, Boehner said there will still be revenue coming in and “It’s way too early to make veiled threats like that.”

Boehner also spoke positively about Mitch McConnell’s proposal to avoid default as a possible “last-ditch” stop gap measure.

“I think everybody believes there needs to be a backup plan if we are unable to come to an agreement,” Boehner said.  “And frankly I believe Mitch has done good work.”

If we don’t have an agreement as we get closer to Aug. 2, he added, “We may be looking for all kinds of plans to find a way to avoid default."

Copyright 2011 ABC News Radio


Gingrich Condemns McConnell's 'Last Choice' Debt Ceiling Plan

Jessica McGowan/Getty Images(WASHINGTON) -- Former Speaker of the House Newt Gingrich condemned Sen. Mitch McConnell’s “last choice option” plan for the federal deficit, calling it "irresponsible."

“McConnell’s plan is an irresponsible surrender to big government, big deficits and continued overspending.  I oppose it,” Gingrich tweeted Tuesday.

“The answer to Obama’s irresponsibility is a principled ‘no,’ not a blank check,” Gingrich said in a second tweet.

At an event in Pella, Iowa Monday, Gingrich said defaulting would be a “violation of the Constitution.”  Gingrich has argued for no tax increases in the debt negotiations and urged Republicans to hold firm on their requirement of deep spending cuts from Obama.

"Don’t give him a penny more in debt ceiling than he accepts in spending cuts and if he only wants to accept enough spending cuts to get through the next six months that’s fine.  Then six months from now, you’ll have another fight and get another round of spending cuts from it, but insist that we turn the corner and we move on a trajectory that gets us back to a balanced budget and then stay on that balanced budget long enough to pay down the national debt," Gingrich said Monday.

Copyright 2011 ABC News Radio


Deficit Commission Co-Chair Decries Lawmakers' Inability to Make Deal

The White House/Pete Souza(WASHINGTON) -- Former Sen. Alan Simpson, R-Wyo., the GOP co-chair of President Obama's deficit commission, told ABC News that "The American people are disgusted at both parties" for not being able to agree on a measure to reduce the deficit.

"Everybody says, 'What in the hell is going on?'" Simpson said.  "The American people are smarter than their politicians."
He also expressed misgivings about his perception that House Majority Leader Eric Cantor, R-Va., undermined Speaker John Boehner's ability to compromise with Democrats, saying, "The stuff that’s going on in my party, where the -- pettiness overcomes the patriotism -- it’s just disgusting to me."

Simpson criticized anti-tax activist Grover Norquist and the AARP as preventing progress.

"You cant get there with this continual business of don’t touch this and don’t touch that," he said.

He reiterated what the Deficit Commission plan spelled out: that the only way to arrive at a serious attempt at deficit reform is with a combination of cuts to entitlement programs and new taxes.

"Reagan raised taxes," Simpson said.  "We’ve never had less revenue to run this country since the Korean war."

Contrary to some Republicans who've expressed skepticism about the Aug. 2 default date, Simpson said Treasury Secretary "Tim Geithner ain't fooling."

"This is turning into a laugh except there’s nothing funny about it," he said.

Copyright 2011 ABC News Radio


Let There Be Light Bulbs: Parties Divided over Bulb Efficiency Vote

Jupiterimages/Thinkstock(WASHINGTON) -- Is the federal government’s plan to phase out energy-inefficient incandescent light bulbs an assault on Americans’ freedom of choice?

Texas Gov. Rick Perry and presidential candidate Michele Bachmann certainly think so, as does Rep. Joe Barton, R-Texas, whose bill to repeal the federally mandated phase-out failed to pass after a vote in the House Tuesday evening.

Perry, who is rumored to be weighing a presidential bid, signed a bill into state law in June that would allow Texans to keep their less-efficient bulbs after the federal ban goes into effect in January. The bill’s sponsor, State Rep. George Lavender, said if the traditional bulbs were made and sold in Texas, the federal government could not use the Interstate Commerce Clause to regulate them.

But the fight is about far more than light bulbs.

“It’s a symbol for a lot of things happening right now with the federal government, with them trying to micromanage our lives,” Republican Lavender said. “I don’t think anyone voted for their congressman or their senator to go up there to Washington and vote for what kind of light bulb they could buy.”

Minnesota Rep. Bachmann seems to agree. She introduced a bill in March that would repeal the phase-out unless the new bulbs were proven to save consumers money, did not pose a health risk because of their mercury content and reduced overall carbon dioxide emissions by 20 percent in the next 24 years.

“Frankly, I would be surprised if the [Government Accountability Office] can prove these criteria, but at minimum, my bill will provide the opportunity to examine these important issues,” Bachmann said in a March statement. “The American people want less government intrusion into their lives, not more, and that includes staying out of their personal light bulb choices.”

The federal law, signed in 2007 by then-president George W. Bush, requires all bulbs to be 25 percent more efficient by 2014. That would mean a traditional 100-watt incandescent bulb must now use only 72 watts.

But that doesn’t mean consumers have to buy the curly compact florescent bulb, which, as Lavender said, “most people I know don’t like.” An updated version of the revered incandescent bulb uses halogen gas to increase efficiency, but leaves the bulbs otherwise unaltered. These bulbs cost about $1 more than the old ones.

Andrew deLaski, the executive director of the Appliance Standards Awareness Project,  said the light bulb issue has become a “political football”  and “a kind of rallying cry for Tea Party conservatives who use it as a symbol of the federal government, which they like to demonize.”

DeLaski pointed out that energy-efficiency standards for home appliances were first enacted by Republican President Ronald Reagan in 1987.

Rep. Earl Blumenauer, D-Ore., who was on ABC’s Top Line Tuesday, expressed his frustrations with the House’s efforts to reinstate the inefficient bulbs.

"GOP brought back Styrofoam, now trying to bring back inefficient light bulbs...Rotary phones may also make a comeback #GOPBacktotheFuture” he tweeted.

When Republicans took over the House in 2011 they reinstated Styrofoam packaging in the cafeterias, ending a three-year compost program started by then-Speaker Nancy Pelosi. The Democratic leadership had replaced the cheaper, but non-recyclable Styrofoam with slightly more expensive, compostable dishes.

Copyright 2011 ABC News Radio


John Boehner: Debt Limit Increase Is Obama's Problem to Fix

MANDEL NGAN/AFP/Getty Images(WASHINGTON) -- With less than three weeks left to reach a deal, House Speaker John Boehner of Ohio said the debt limit is President Obama’s problem to solve, and called on the president to lead and present a plan that he believes can pass both chambers of Congress.

“House Republicans have a plan. We passed our budget back in the spring, outlined our priorities. Where’s the president’s plan? When’s he going to lay his cards on the table? This debt limit increase is his problem, and I think it’s time for him to lead by putting his plan on the table, something that the Congress can pass,” Boehner said. “My message to the White House over the last several months has been real simple: The spending cuts have to be larger than the increase in the debt ceiling. Secondly, there are no tax increases on the table, and, thirdly, we have to have real controls in place to make sure this never happens again; real controls like a balanced budget amendment.”

One top Democrat involved in the negotiations, House Minority Whip Steny Hoyer of Maryland, defended Obama and said a vote to raise the debt limit is not a vote to bail out the president but rather a vote to ensure the credibility of America.

“It seems to be totally partisan premise that somehow extending the debt is to the benefit of President Obama. It’s to the benefit of the country and president Obama is working as assiduously and faithfully on behalf of the creditworthiness of the country as any president could be expected to do,” Hoyer said. “The reason we need to increase the debt is because the creditworthiness of the Untied States of America is in the best interest of every American, so I’ll reject out of hand, categorically, and emphatically that somehow they are giving us this.”

Senate Minority Mitch McConnell of Kentucky went to the Senate floor earlier Tuesday blasting the president  for “deliberate deception,” while contending that as long as Obama is in the Oval Office “a real solution is unattainable.”

Boehner would not go that far, but admitted that “finding agreement certainly has been elusive.”

“I’ve been in conversations with the president for the last couple of months and clearly the last couple of weeks in a serious way,” Boehner said. “The president talks a good game, but when it comes time to actually putting these issues on the table, making decisions, he can’t quite pull the trigger.”

Boehner warned that if lawmakers “don’t fix the entitlement programs, they will not exist,” but added that he was optimistic the leaders would eventually strike a deal.

Copyright 2011 ABC News Radio


Ron Paul Won't Run for Re-Election to Congress; 'All In' for White House Run

Jason Merritt/Getty Images(CLUTE, Texas) Whether or not Texas Congressman Ron Paul wins his long-shot presidential bid in 2012, he won't be returning to the U.S. House of Representatives.

Paul told a Texas newspaper on Tuesday that he plans to "concentrate" on the race for the GOP nomination instead. A campaign spokesman confirmed Paul's decision to ABC News.

It could be the end of an era for Paul, the libertarian-leaning representative from the Lone Star State’s 14th Congressional district who has served in Congress for nearly a quarter of a century.

“I felt it was better that I concentrate on one election,” Paul told the Brazoria County newspaper, The Facts in an interview. “It’s about that time when I should change tactics.”

Campaign spokesman Jesse Benton told ABC News, "Ron is all in and will work tirelessly to win the Presidency and save this country."

As the paper notes, “His announcement will give enough time for anyone with aspirations for his seat to think about running, he said. Paul didn’t want to wait for filing in the 2012 primary to let people know he wasn’t seeking reelection.”

Rep. Michele Bachmann, R-Minn., hasn’t made a definitive decision yet on whether she will seek to return to the House if her presidential bid fails. The conservative Republican presidential candidate has said she is not "actively seeking reelection." However, she has not ruled it out entirely. Minnesota has a late Congressional filing deadline so she’s got plenty of time before she has to make a go-no-go decision.

Copyright 2011 ABC News Radio


Schumer: Cantor’s Debt Ceiling Proposal Immoral

ABC News(WASHINGTON) -- The fierce rhetoric on the Senate floor Tuesday continued with Sen. Charles Schumer, D-NY., who pointed a finger at the Republicans for being “dragged so far to the right by its ideological fringe,” that they are not able to get actually compromise to get a deal to raise the nation’s $14.3 trillion debt ceiling.

“They would sooner end Medicare as we know it than ask millionaires and billionaires to pay a little more in taxes,” Schumer said, quipping that House Speaker Boehner “balked” at a Grand Bargain because of pressure from within his own party. “That's the nub of it. They would sooner end Medicare as we know it than ask millionaires and billionaires to pay a little more in taxes.”

Intentionally highlighting the divide between Republicans Cantor and Boehner, Schumer added that it seems that House Majority Leader Eric Cantor “is now the leader of these negotiations for the Republicans” after it was reported he did the plurality of talking on the Republican side at the White House debt meetings Monday.

Schumer called House Majority Leader Cantor’s proposal, made at the White House on Monday, which outlines $353 billion in health care cuts, with $250 billion in reductions in Medicare “troubling.”

“This approach is not balanced, it's not fair, it's not moral, and it will not be accepted. The proposal by Leader Cantor is very troubling.”

He repeated that an agreement “cannot be considered bold or comprehensive” unless it asks “millionaires, billionaires and wealthy corporations to contribute to deficit reduction.”

Schumer warned that time is running out to cut a deal with enough time before the Aug. 2 deadline for action set by the administration.

“This is crunch time. The clock is ticking” he said, “if we don't reach an agreement in the next few weeks, we risk roiling the financial markets and our nation's fragile economy will suffer a serious setback.”

Copyright 2011 ABC News Radio


Huntsman Campaign Goes Nuclear on Romney’s Job Creation Record

ChinaFotoPress/Getty Images(WASHINGTON) -- A war of words erupted between two Republican presidential campaigns Tuesday as the Jon Huntsman campaign attacked Mitt Romney over job creation in Massachusetts and a Romney spokesperson defended the GOP presidential nomination frontrunner.

It all started at a GOP fundraiser in South Carolina last night. Jon Huntsman subtly called out former Governor Mitt Romney’s home state of Massachusetts for ranking 47th in the nation in terms of job creation.

Romney Spokesperson Andrea Saul responded Tuesday, emailing ABC News to say: “Mitt Romney created nearly 50,000 jobs as governor of Massachusetts and led his state to one of the most dramatic job market turnarounds in the country.”

Huntsman Spokesperson Tim Miller quickly shot back with a fiery tone never before seen by the campaign. He told ABC News: “You know your job creation record is bad when you brag about leapfrogging a state ravaged by Hurricane Katrina. The reality is Mitt Romney's record on job creation was abysmal by every standard. Governor Huntsman will run on his record of cutting taxes, reducing regulation, and passing free market health care which resulted in Utah becoming the #1 state for job creation. We assume Mitt Romney will continue to run away from his record.”

The offensive by Huntsman’s campaign is a new tactic for someone who kicked off his presidential bid last month by promising “respect and humanity” in debates.

"We will conduct this campaign on the high road," Huntsman told ABC News in June. "I don't think you need to run down someone's reputation to run for president."

Copyright 2011 ABC News Radio


Debt Talks Continue; Consensus Needed on Deficit Reduction

The White House/Pete Souza(WASHINGTON) -- Officials familiar with the negotiations say Monday’s meeting began with President Obama asking House Majority Leader Eric Cantor, R-Va., to lay out what was agreed upon in the deficit reduction talks led by Vice President Biden.

Cantor outlined around $2 trillion in deficit reduction over the next decade: $1-1.1 trillion in discretionary spending; $200 billion in mandatory discretionary spending, such as civilian military retirement and farm subsidies; $200 billion in Medicare and Medicaid; and roughly $200-300 billion in saved interest on the debt.

After Cantor’s presentation, the president said the two sides might be able to reach consensus on roughly $1.7 trillion, though there were still some issues to resolve.

House Speaker John Boehner, R-Ohio, has said the amount they agree to in deficit reduction needs to be equal to -- if not more than -- the amount they agree to raise the debt ceiling.

There seemed to be consensus in the room that the amount by which they need to raise the debt ceiling is $2.4 trillion.  That would get the government to February or March 2013.

Why that date?  No one thinks a lame duck Congress should take this on from November 2012 to January 2013 and that would allow the new Congress and maybe a new president to get his or her sea legs before again addressing the issue.

So Tuesday’s homework assignment, the president said, is for the congressional leaders to figure out how to get from $1.7 trillion to $2.4 trillion.

Republicans are still insisting on no new taxes.  Democrats say they need some revenues -- a “balanced approach” -- to get Democratic votes.

As House Minority Leader Steny Hoyer, D-Maryland, said Monday, “Republicans must be prepared to make concessions of their own and not put the entire burden on seniors, the middle class and the most vulnerable among us."

The president on Monday continued to make the case for a big deal, arguing that if they’re going to draw heat for the deal, they should at least do more than make a down payment on the deficit -- they should get the country on sounder financial footing and begin to seriously bend the deficit cost curve.

The meeting broke after about an hour and a half.

“We’ll meet tomorrow at the White House at 3:45,” the president said.

“A.M. or P.M.?” Senate Majority Leader Harry Reid, D-Nev., joked.

“It may come to that,” the president said.

Copyright 2011 ABC News Radio

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