A day after debt-reduction talks led by Vice President Biden appeared to have broken down, the White House announced that President Obama would directly intervene in the negotiations, beginning meetings with Biden and key lawmakers next week.
Obama and Biden will start by meeting separately with Senate Majority Leader Harry M. Reid (D-Nev.) and Senate Minority Leader Mitch McConnell (R-Ky.) on Monday.
A new take on the overlapping priorities that led us to record deficits, and who voted for them.
Stepping directly into stalled debt talks, President Barack Obama is inviting Senate Majority Leader Harry Reid and Republican leader Mitch McConnell to separate meetings Monday, shifting the negotiations to the highest levels. (June 24)
Running in the red
White House press secretary Jay Carney told reporters Friday aboard Air Force One that “we believe that we can move forward as long as no one in the talks takes a ‘my way or the highway’ approach.”
The parties face an Aug. 2 deadline set by the Treasury Department to raise the country’s $14.3 trillion debt limit before the country risks defaulting on its debt obligations.
“I have a larger vision for America . . . where we work together, Democrats and Republicans, to live within our means, to cut our deficit and debt, but also to invest in what our economy needs to grow,” Obama said Friday before a crowd at Carnegie Mellon University, where he announced a new initiative to spark job growth.
But a quick compromise seemed unlikely Friday as House Speaker John A. Boehner (R-Ohio) reiterated his pledge to oppose any comprehensive deficit-reduction deal that would increase taxes. The issue of tax increases is one of the fundamental philosophical differences between the parties that congressional negotiators just this week began to address in the Biden talks.
“The president and his party may want a debt limit increase that includes tax hikes, but such a proposal cannot pass the House,” Boehner said in a statement.
He said any deal must include spending cuts that exceed the amount of the debt-limit hike and budget reforms that will restrict Washington’s ability to spend in the future — not tax increases.
Conservative Sen. Jim DeMint (R-S.C.) upped the ante Friday, warning in an interview with ABC News that Republicans who vote for raising the debt ceiling without passing a balanced-budget amendment and sweeping spending cuts are “gone.”
“It would be the most toxic vote,” DeMint told ABC News. “I can tell you, if you look at the polls, Democrats, Republicans, independents, they do not think we should increase the debt limit.”
Congressional Republicans, who abruptly pulled out of debt-reduction talks with the White House on Thursday, said the negotiations reached an impasse because Democrats were pressing what Boehner called “job-killing tax hikes.”
The White House pushed back Friday, saying the administration is seeking fresh revenues that target corporations and the wealthy, not small businesses and the middle class.
People familiar with the discussions said the White House has offered a menu of revenue raisers that would generate between $200 billion and $300 billion over the next decade. They include a variety of corporate provisions, such as an adjustment in the way inventory is taxed that would generate about $70 billion, higher tax rates on what is known as “carried interest” earned by hedge fund managers that would generate about $20 billion, and an end to a perk that saves the owners of corporate jets about $3 billion over 10 years.
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