WASHINGTON -- There were no real signs of progress in Tuesday's White House debt talks. But the meeting did shed light on two evolving dynamics taking place in the ongoing negotiations: President Barack Obama's increasing appetite to cut spending in a substantial way, and Republicans sinking under the weight of their own hard-line approach to a deal.
For all its talk of the importance of averting a debt default, the White House is signaling that major deficit reduction has become more than just a bargaining chip to bring Republicans aboard a debt deal.
Treasury Secretary Timothy Geithner opened Tuesday's meeting not by focusing on the perils of debt default, but instead with a "vivid" presentation on "what happens if you don't cut the deficit," according to a Democratic source familiar with the talks.
Geithner warned the group that ratings agencies are actively watching both the debt ceiling debate and the ability of Congress to turn around the nation's growing deficit and debt. He pointed to the economic unrest in Europe as evidence of what could happen in the United States if the White House and Congress don't tackle the deficit in a serious way.
Lawmakers obviously discussed the pressing consequences of debt default, said the Democratic official. And on that front there still "continues to be a big difference on revenue."
But as negotiations on a debt package resumed, Obama made it clear that he isn't playing small ball. He warned Republicans that the major concessions he has offered on entitlement reforms are off the table if they don't agree to a sizable debt deal. There could still be some tinkering with Medicare and Medicaid, he told the group, but it would come from the supplier side, not the benefit side.
Throughout the meeting, the president urged Republicans to reconsider the benefits of passing a bigger package, which now seems likely to fall somewhere between the $4 trillion that Obama wanted and the $2.4 trillion that Vice President Joseph Biden targeted in his now-defunct bipartisan deficit group. Whether entitlement reforms remain part of that equation is undetermined. But Democratic negotiators reiterated that even the low end of that deal would have to include a revenue component.
The partisanship simmering beneath the talks also appeared to wane somewhat on Tuesday. Another Democratic official with knowledge of the meeting described it as "more constructive than the other ones," adding that there was a "general consensus about the need to stop talking past each other."
Congressional leaders are headed back to the White House on Wednesday at 4 p.m. to "begin trying to go officially through the stuff in the Biden discussion."
An alternative debt plan floated earlier Tuesday by Senate Minority Leader Mitch McConnell (R-Ky.) "was brought up" during the meeting, the official added. "But it was sort of pushed to the side" as attendees focused on areas of agreement on spending cuts and revenue reforms discussed in Biden's group.
McConnell's proposal crashed and burned within his own party almost as soon as it was unveiled. Under his proposal, Congress would give up its power to raise the debt ceiling and effectively transfer that authority to the White House for the remainder of Obama's current term. Conservatives immediately trashed the idea and accused McConnell of capitulating in the debt debate. The conservative blog RedState even called on supporters to send McConnell a weasel -- and provided a link to a toy weasel on Amazon.com -- as "a testament to his treachery."
Full Article
Source: Huffington
For all its talk of the importance of averting a debt default, the White House is signaling that major deficit reduction has become more than just a bargaining chip to bring Republicans aboard a debt deal.
Treasury Secretary Timothy Geithner opened Tuesday's meeting not by focusing on the perils of debt default, but instead with a "vivid" presentation on "what happens if you don't cut the deficit," according to a Democratic source familiar with the talks.
Geithner warned the group that ratings agencies are actively watching both the debt ceiling debate and the ability of Congress to turn around the nation's growing deficit and debt. He pointed to the economic unrest in Europe as evidence of what could happen in the United States if the White House and Congress don't tackle the deficit in a serious way.
Lawmakers obviously discussed the pressing consequences of debt default, said the Democratic official. And on that front there still "continues to be a big difference on revenue."
But as negotiations on a debt package resumed, Obama made it clear that he isn't playing small ball. He warned Republicans that the major concessions he has offered on entitlement reforms are off the table if they don't agree to a sizable debt deal. There could still be some tinkering with Medicare and Medicaid, he told the group, but it would come from the supplier side, not the benefit side.
Throughout the meeting, the president urged Republicans to reconsider the benefits of passing a bigger package, which now seems likely to fall somewhere between the $4 trillion that Obama wanted and the $2.4 trillion that Vice President Joseph Biden targeted in his now-defunct bipartisan deficit group. Whether entitlement reforms remain part of that equation is undetermined. But Democratic negotiators reiterated that even the low end of that deal would have to include a revenue component.
The partisanship simmering beneath the talks also appeared to wane somewhat on Tuesday. Another Democratic official with knowledge of the meeting described it as "more constructive than the other ones," adding that there was a "general consensus about the need to stop talking past each other."
Congressional leaders are headed back to the White House on Wednesday at 4 p.m. to "begin trying to go officially through the stuff in the Biden discussion."
An alternative debt plan floated earlier Tuesday by Senate Minority Leader Mitch McConnell (R-Ky.) "was brought up" during the meeting, the official added. "But it was sort of pushed to the side" as attendees focused on areas of agreement on spending cuts and revenue reforms discussed in Biden's group.
McConnell's proposal crashed and burned within his own party almost as soon as it was unveiled. Under his proposal, Congress would give up its power to raise the debt ceiling and effectively transfer that authority to the White House for the remainder of Obama's current term. Conservatives immediately trashed the idea and accused McConnell of capitulating in the debt debate. The conservative blog RedState even called on supporters to send McConnell a weasel -- and provided a link to a toy weasel on Amazon.com -- as "a testament to his treachery."
Full Article
Source: Huffington
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