Archive for Monday, July 18, 2011

Obama threatens to veto GOP plan to cut spending

July 18, 2011

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— Courting confrontation and compromise alike, House Republicans shrugged off President Barack Obama’s threat to veto legislation to cut federal spending by trillions of dollars on Monday while simultaneously negotiating with him over more modest steps to avert a potential government default.

The Republican bill demands deep spending reductions and congressional approval of a balanced budget amendment to the Constitution in exchange for raising the nation’s debt limit. But Obama will veto it if it reaches his desk, the White House said, asserting the legislation would “lead to severe cuts in Medicare and Social Security” and impose unrealistic limits on education spending.

In response, GOP lawmakers said they would go ahead with plans to pass the bill today.

“It’s disappointing the White House would reject this commonsense plan to rein in the debt and deficits that are hurting job creation in America,” Speaker John Boehner, R-Ohio said.

By contrast, neither the administration nor congressional officials provided substantive details on an unannounced meeting that Obama held Sunday with the two top House Republican leaders, Boehner and Majority Leader Eric Cantor of Virginia.

Obama said late Monday the two sides were “making progress.”

Several Republicans said privately the decision to vote on veto-threatened legislation is paradoxically designed to clear the way for a compromise. They said conservatives would have a chance to push their deep spending cuts through the House, and then see the measure quickly die either in the Democratic-controlled Senate or by veto.

Barring action by Congress to raise the $14.3 trillion debt limit, the Treasury will be unable to pay all the government’s bills that come due beginning on Aug. 3, two weeks from Wednesday. Administration officials, Federal Reserve Chairman Ben Bernanke and others say the result could be a default that inflicts serious harm on the economy, which is still struggling to recover from the worst recession in decades.

In a gesture underscoring the significance of the issue, Majority Leader Harry Reid, D-Nev., announced the Senate will meet each day until it is resolved, including on weekends.

The two-pronged approach pursued by the House GOP follows the collapse of a weeks-long effort to negotiate a sweeping bipartisan plan to cut into future deficits. The endeavor foundered when Obama demanded that tax increases on the wealthy and selected corporations be included alongside cuts in benefit programs, and Republicans refused.

The failure of that effort also reflects the outsized influence exerted by 87 first-term Republicans, many of them elected last fall with tea party backing.

As late as last Thursday, Republican leaders held a news conference to tout plans to vote this week on a proposed balanced budget amendment to the Constitution.

But the same senior Republicans emerged from a closed-door meeting of the rank and file on Friday to say the House would instead vote on an alternative — dubbed by its advocates as “Cut, Cap and Balance.” No date has been set for a vote on the constitutional amendment itself.

Officials said the change in course had been requested by members of the Republican Study Committee, whose members are among the most conservative in Congress.

Supporters of the measure say it would cut $111 billion from government spending in the budget year that begins on Oct 1, and $6 trillion more over the coming decade through a requirement that the budget shrink relative to the overall size of the economy.

Additionally, it would require both houses of Congress to approve a balanced budget amendment to the Constitution as a condition for an increase in the debt limit.

Both Boehner and Cantor reacted relatively mildly to the White House veto threat.

“As President Obama has not put forth a plan that can garner 218 votes in the House, I’d caution him against so hastily dismissing ‘Cut, Cap and Balance,”’ Cantor said.

Comments

Richard Heckler 4 years, 1 month ago

The “Peoples Budget” does everything this country needs:

* Creates good-paying jobs
* Fully maintains our social safety net
* Invests in education
* Ends our costly wars
* Closes the tax loopholes that have made offshoring jobs profitable
* Ends oil and gas subsidies that pollute our country at taxpayer expense
* Creates a national infrastructure investment bank to help us make intelligent investments for the future

The “People's Budget” represents not just common sense; it represents the will of the American people.

What the “Peoples Budget” does very specifically:

http://cpc.grijalva.house.gov/index.cfm?sectionid=70&sectiontree=5,70

http://www.npr.org/2011/04/15/135435883/the-nation-obama-should-fight-for-peoples-budget

http://www.democracynow.org/2011/4/14/while_obama_touts_compromise_with_gop

http://www.thenation.com/blog/159939/fighting-peoples-budget

Richard Heckler 4 years, 1 month ago

After spending so so many decades in Washington D.C on tax dollar payrolls republicans are sure they learned all they needed to know about OUR money and founding reckless economies. Republicans have much experience under their belts and they never quit sharing.

For openers...

  1. TABOR is Coming by Grover Norquist and Koch Bros. http://www.dollarsandsense.org/archives/2005/0705rebne.html

  2. The Reagan/Bush Savings and Loan Heist(Cost taxpayers $1.4 trillion) http://rationalrevolution0.tripod.com/war/bush_family_and_the_s.htm

  3. Wall Street Bank Fraud on Consumers under Bush/Cheney http://www.dollarsandsense.org/archives/2009/0709macewan.html

  4. Bush and Henry Paulson blew the $700 billion of bail out money? http://www.democracynow.org/2009/9/10/good_billions_after_bad_one_year

And that tax cuts do nothing to make an economy strong or produce jobs.

  1. Still A Bad Idea – Bush Tax Cuts - The ENTITLEMENT program for the wealthy at the expense of the middle class http://www.dollarsandsense.org/archives/2001/0301miller.html

In the end big debt and super duper bailouts were the results which does not seem to bother Republicans, as long as they are in power.

In fact, by the time the second Bush left office, the national debt had grown to $12.1 trillion:

  • Over half of that amount had been created by Bush’s tax cuts for the very wealthy.

  • Another 30% of the national debt had been created by the tax cuts for the wealthy under Presidents Reagan and George H.W. Bush.

• Fully 81% of the national debt was created by just these three Republican Presidents. http://www.dollarsandsense.org/archives/2010/0111orr.html

Richard Heckler 4 years, 1 month ago

What's missing from this national deficit debate? JOBS JOBS JOBS AND MORE JOBS

Removing the large tax dollar subsidies to very wealthy USA corporations should be the priority.

Then apply these tax dollars to a new type of medical insurance for all that which creates a strong economic driver to promote new employment, new industry and new wealth for the nation.

This is a thrilling conversion.

If all city and state governments plus the federal government would cut corporate welfare and invest this money in IMPROVED Medicare Single Payer Insurance for ALL :

  1. many of us would be saving thousands of dollars annually

  2. big business and small business could operate for less

  3. all governments and school districts could cut operating expenses substantially

  4. employed blue and white collar workers would be healthier thus more productive

  5. all humans would have necessary healthcare 24/7

  6. in general OUR cost of living would decrease across the board

  7. New industry,small business and jobs would develop

Now a new type of medical insurance for all becomes a strong economic driver across the for the entire nations communities.

Thus our tax dollars would be invested in our local communities providing a jump start to economic growth that has been squandered as one result of corp welfare.

Richard Heckler 4 years, 1 month ago

With corporations routinely defaulting on their pension promises, more and more workers must rely on their individual wealth to make up the difference. The stock market collapse at the turn of the millennium wiped out much of the financial wealth of middle class Americans, and the collapse of the housing bubble has wiped out much of their remaining wealth.

Making any cuts to Social Security now, either by raising the retirement age or cutting benefits, would have a huge impact on their remaining retirement income and are not necessary to “save the system.

yourworstnightmare 4 years, 1 month ago

A balanced budget amendment? What is this, 1985? Get some new ideas, GOP.

just_another_bozo_on_this_bus 4 years, 1 month ago

They have no workable ideas, so they trot out old ones they know can never be implemented as a distraction.

jafs 4 years, 1 month ago

What's wrong with a balanced budget amendment? I think it's a very good idea, in fact.

yourworstnightmare 4 years, 1 month ago

The biggest problem is that it removes budgetary flexibility for emergencies, like wars or economic collapses.

The other problem is that it absolves legislators and the American public of their responsibilities to decide how much should be spent and on what.

Republican governors love to balance budgets by slashing spending, but moderates realize the damage that the requirement for a balanced budget can do to state infrastructure and services.

Cait McKnelly 4 years, 1 month ago

Oh it's sustainable. Just not in a way you like.

jafs 4 years, 1 month ago

If we have and keep surpluses when we have them, we could then use them when times are difficult. I imagine there could be ways to deal with wars - figuring out how we're going to pay for them without borrowing trillions of dollars sounds like a good idea to me as well.

How does it absolve anybody of that responsibility? American voters vote for representatives, who have philosophies about taxes and spending. Those philosophies are then reflected in decisions.

The other way to balance a budget is to increase revenue, which would be perfectly acceptable with a bb amendment. It only requires that we stop borrowing money, and live on what we collect. Eminently sensible.

just_another_bozo_on_this_bus 4 years, 1 month ago

"If we have and keep surpluses when we have them, we could then use them when times are difficult."

If you think that "fiscal conservatives" howl over deficits, just wait till we start keeping surpluses, which basically means levying taxes, and then sitting on the cash.

If you ain't gonna spend it, why collect it?

MyName 4 years, 1 month ago

In theory it is, but the one they're proposing would basically require a form of clairvoyance in order to work as promised since the budget would only be allowed to be a portion of GDP for the upcoming year, but you have know way of knowing whether or not you went over that target until after the end of the fiscal year, when the accountants figure out what's been spent and the economists figure out what the GDP actually was.

jafs 4 years, 1 month ago

Then tweak it, and find a better way to do it.

just_another_bozo_on_this_bus 4 years, 1 month ago

"What's wrong with a balanced budget amendment?"

As yourworstnightmare already noted, it would remove budgetary flexibility.

Bottomline is that as long as it's done sensibly, deficit spending by the central government is absolutely necessary to keep the economy flowing.

Is it possible to do deficit spending idiotically? Sure, as BushCo so amply demonstrated when they cut taxes on the wealthy (who had already received rather substantial cuts in the previous 25 years running) while simultaneously starting two unnecessary wars.

Richard Heckler 4 years, 1 month ago

Tell Congress: "Save One Trillion Dollars in Ten Years"

Petition to End Corporate Welfare and Expand Medicare

http://www.pdamerica.org/forms/sign/save-one-trillion-dollars-in-ten

beatrice 4 years, 1 month ago

This is all just a silly game for political posers. The American people are tired of it.

"At least two-thirds say congressional Republicans and Democrats put their own political interests ahead of the country's best interests. Just 7% see both sides as negotiating in good faith." http://www.usatoday.com/news/washington/2011-07-18-poll-obama-congress-debt_n.htm

MyName 4 years, 1 month ago

That's because most of the wingnut bills have died in the Senate. So basically the same reason Bush vetoed so few bills during his term.

Centerville 4 years, 1 month ago

Obama's 'budget' went down in the Senate 98-0 and Zip hasn't made one suggestion since. And the Senate Democrats haven't produced a budget or even 'a Plan' in over two years. So we are supposed to just borrow away until the Chicoms pull the plug?

MyName 4 years, 1 month ago

And the GOP only likes "C-men" apparently. Doesn't look like either of them really care about the poor or the middle class.

beatrice 4 years, 1 month ago

barryp, consider Obama's opponent in the previous election. Exactly how much has John McCain made in the private sector? Perhaps you shouldn't be so quick to criticize if the Republicans didn't offer an alternative.

Kim Murphree 4 years, 1 month ago

Thank you President Obama for holding the line against those who would create a country with no middle class, massive poor population, death in the special needs and elderly communities, and allow only the wealthy to continue to amass wealth. I know you've tried to compromise but they are shameless in their political protection of the wealthy--who by the way--have created NO jobs with their Bush tax cuts. Rock on Obama!

Richard Heckler 4 years, 1 month ago

The GOP plan still adds $6 trillion to the deficit over 10 years. Sounds about right.

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