Washington, D.C. — Struggling to avert an unprecedented national default, congressional leaders jettisoned negotiations on a sweeping deficit-reduction package Friday despite a plea from President Barack Obama to “do something big” to stabilize America’s finances.
Instead, lawmakers embarked on competing fallback plans as a critical Aug. 2 deadline neared, a House Republican version given little chance of success, even by some supporters, and a bipartisan Senate approach holding out more promise to avert what Obama called financial “Armageddon.”
Late Friday, the Treasury Department announced it was resorting to the final steps in an unusual series designed to avoid exceeding the current $14.3 trillion debt limit. Numerous officials have cautioned that a default will occur if the limit is not increased by Aug. 2, warning also of a calamitous effect on a national economy struggling to recover from the worst recession in decades.
At the behest of conservatives, House Republicans announced plans to vote next week on legislation to permit more borrowing automatically if Congress approves a balanced-budget constitutional amendment. Senate approval of that amendment seemed extremely unlikely in a vote set for the next few days.
At the same time, Senate leaders from both parties worked on their own fallback measure that would allow Obama to raise the debt limit without a prior vote by lawmakers, discussions that now have expanded to include House officials and top White House aides.
That plan was likely to include limits on spending across thousands of government programs, and possibly a down payment on cuts, as well.
As part of that proposal, a panel of lawmakers would recommend cuts in benefits programs by the end of the year, with the House and Senate required to vote yes-or-no on the package without possibility of changes.
“If they show me a serious plan, I’m ready to move,” declared Obama at his second news conference of the week, even though he said he wanted a far more sweeping deal that might even have raised the age of Medicare eligibility from 65 to 67 if Republicans would increase selected taxes.
Senate Republican leader Mitch McConnell said, “Now the debate will move from a room in the White House to the House and Senate floors,” an indication that the daily closed-door negotiations on Obama’s home ground were a thing of the past.
Comments
Liberty275 2 years, 7 months ago
"he said he wanted a far more sweeping deal that might even have raised the age of Medicare eligibility from 65 to 67 if Republicans would increase selected taxes."
Crooks. How can you left wingers defend a man that would raise the age of eligibility for medicare in exchange for a few paltry dollars in extra taxes? Did you cast your vote for a man that would consider raising the age when medicare benefits become available? Is that what you voted for? Yes you did.
just_another_bozo_on_this_bus 2 years, 7 months ago
The budget deficit can't be solved by denying assistance for food, shelter and medical care to the poor, the elderly and the disabled in order to finance tax breaks for the ueberwealthy, which is the sum total of teaparty/Republicanic policy demands. The funding of such programs isn't what caused the crash of the economy, and punishing the already punished won't fix it.
The only things that can turn this economy turned around and the deficit reduced are a closure of all foreign military basis, an end to all involvement in however many wars we're now engaged in, and a concomitant reduction in the "defense" budget of at least 50%; some form of single-payer health care reform; a return to at least a 40% top rate on income taxes; a massive stimulus package that funds R&D in alternative energy and mass transportation along loans and tax credits for small businesses and farms that will remake the economy away from centralized corporate bureaucracies that lack any imagination beyond the maximization of the next quarter's profit statement.
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