Debt crisis: Boehner retools plan to solve debt crisis
Updated: July 27, 2011 - 07:02 pm
WASHINGTON (AP) - Six days away from a potentially calamitous government default, House Republicans appeared to be coalescing Wednesday around a work-in-progress plan by House Speaker John Boehner to increase the U.S. borrowing limit and chop $1 trillion in federal spending. But the White House dismissed the proposal as a waste of time, and it got a thumbs-down from Senate Democrats and tea party activists, too.
It was a telling illustration of the difficult politics along the pathway to a deal in a standoff that has put financial markets on edge. Stocks were falling sharply Wednesday.
GOP leaders worked to line up support for Boehner's proposal, which was being retooled after nonpartisan analysts in the Congressional Budget Office said it would cut spending less than he had estimated - about $850 billion over 10 years rather than $1.2 trillion. The House planned to vote on the reworked plan Thursday, with Boehner calling it "the best opportunity we have to hold the president's feet to the fire."
White House spokesman Jay Carney dismissed all the focus on the GOP plan as a distraction.
"Why are we voting on measures that have no chance of becoming law?" he asked with exasperation. Carney said lawmakers should stop looking for an easy way out of the debt crisis.
"People keep looking for off-ramps," he said. "They don't exist."
Rep. Mike Rogers, R-Mich., said Republicans were gravitating toward Boehner's plan "in a big way." He and others cited changes being made in the bill to make sure spending cuts exceed added borrowing authority, and the fact that the House would soon vote on a balanced budget plan.
Senate Republican Leader Mitch McConnell said only Boehner's plan would resolve the crisis "in a way that will allow us to avoid default without raising taxes and to cut spending budget gimmicks."
But Senate Majority Leader Harry Reid, D-Nev., dismissed the speaker's plan as a short-term measure that would leave the economy on shaky ground. He said it would not get one Democratic vote in the Senate, dooming it to failure and was merely "a big wet kiss for the right wing."
"It's not Democrats who have asked for a long-term solution," Reid said. "It's the economy. The economy has demanded it."
Reid was asked if there was a "drop-dead date" for a deal to pass the House, be amended by the Senate and reach President Barack Obama in time to avoid default.
"Magic things can happen here in Congress in a very short period of time under the right circumstances," he said.
Boehner's proposal caught criticism not just from Democrats but from the right as well. Tea party activists gathered across the street from the Capitol on Wednesday and urged Boehner to reject any deal that doesn't include steep spending cuts - even if the U.S. defaults.
Tea Party Nation, one group within the loosely affiliated movement, issued an online call for Boehner to step down. But other tea party activists said the speaker needs time to strike a good deal. Tea Party Express strategist Sal Russo said that while Boehner was trying to "salvage some small steps to fiscal responsibility, we believe his proposals lack sufficient progress in getting America's economic future on a better footing."
Reid's rival proposal would deliver budget savings of a little more than $2 trillion, a half-trillion less than promised but still more than under Boehner's plan, budget analysts reported. The Senate leader said he'd wait to see what the House did before bringing his plan to a vote.
House Democrats propose Obama invoke 14th Amendment
House Democrats, for their part, focused on finding a fallback plan should the two sides fail to raise the debt ceiling before the government runs out of borrowing authority next week.
Rep. James Clyburn, a member of the Democratic leadership, said he told fellow Democrats that Obama should veto the House GOP plan for a short-term extension of the debt ceiling and invoke the Constitution's 14th Amendment, which says that the validity of the nation's public debt "shall not be questioned."
The White House has rejected resorting to this tactic, questioning its legality. But Democratic Caucus chairman John Larson said that with only days left before Treasury's borrowing authority lapses, "we have to have a failsafe mechanism."
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