Obama, Boehner Again Square Off On Debt Ceiling

"His bill is one that is not going to get much traction in the Democratic-run Senate largely because it was a bill that was drawn up by House Republicans and probably with collaboration of Senate Republican leader Mitch McConnell," NPR's David Welna said. "But I found it somewhat disingenuous for Boehner to say that this is the bill that's going to solve the problems because he didn't mention the fact that this is a piece of legislation that would require two different votes for raising the debt ceiling: one right now and another probably early next year sometime in the midst of next year's campaigns. That is the biggest objection of the White House to what Boehner is proposing."

The back-to-back televised speeches did little to suggest that a compromise was in the offing, and the next steps appeared to be votes in the House and Senate on the rival plans by mid-week.

"Usually when a president asks for time from the networks to make an evening address and speaker of the House answers him, you'd think they were announcing some kind of historic deal or a solution to the problem," NPR's Liasson said. "Instead they both got up to do what they've been doing more or less for the past several months, which is to explain why the other guy's idea is really bad and why the stalemate is somebody else's fault. And I think the American people and certainly the financial markets are probably running out of patience with this."

But despite warnings to the contrary, U.S. financial markets have appeared to take the political maneuvering in stride so far. Wall Street posted losses Monday but with no indication of panic among investors.

"I think there's still a feeling in the markets that eventually this will be worked out and most importantly the interest rates on Treasury debt remain low and stable. ... and it really hasn't budged much," said Uri Berliner, NPR's business editor.

Without signed legislation by day's end on Aug. 2, the Treasury will be unable to pay all its bills, possibly triggering an unprecedented default that officials warn could badly harm a national economy struggling to recover from the worst recession in decades.

Obama wants legislation that will raise the nation's debt limit by at least $2.4 trillion in one vote, enough to avoid a recurrence of the acrimonious current struggle until after the 2012 elections.

Republicans want a two-step process that would require a second vote in the midst of a campaign for control of the White House and both houses of Congress. Liasson noted that the White House is against this approach, and for a while the House Republican leadership was, too.

But "they [now] feel that every time they have this debate, every time they can talk about a balanced-budged amendment, every time they can put the president on the defensive and say, 'If only you agree to these spending cuts, we would raise the debt ceiling,' they feel that that's actually good for them," she said.

There were concessions from both sides embedded in the competing legislation, but they were largely obscured by the partisan rhetoric of the day.

Senate Republican leader Mitch McConnell of Kentucky urged Obama to shift his position rather than "veto the country into default." And Reid jabbed at Tea Party-backed Republicans who make up a significant portion of the House GOP rank and file. The Nevada Democrat warned against allowing "these extremists" to dictate the country's course."

The measure Boehner and the GOP leadership drafted in the House called for spending cuts and an increase in the debt limit to tide the Treasury over until sometime next year. A second increase in borrowing authority would hinge on approval of additional spending cuts sometime during the election year.

Across the Capitol, Reid wrote legislation that drew the president's backing, praise from House Democratic leader Nancy Pelosi and criticism from Republicans.

The Democrats' measure would cut $2.7 trillion in federal spending and raise the debt limit by $2.4 trillion in one step, enough borrowing authority to meet Obama's bottom-line demand. The cuts include $1.2 trillion from across a range of hundreds of government programs and $1 trillion in savings assumed to derive from the end of the wars in Afghanistan and Iraq.

Material from The Associates Press was used in this report

Source: http://www.npr.org/2011/07/25/138691884/obama-boehner-again-square-off-on-debt-ceiling?ft=1&f=1014

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