Obama Takes Over Debt Limit Talks

June 24th, 2011 at 11:29 pm | 3 Comments |

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The Associated Press reports:

Struggling to break a perilous deadlock, President Barack Obama took direct control Friday of national debt-limit negotiations with both Republicans and Democrats. With the White House warning the nation’s economic stability is at stake, it’s one of the most severe tests yet of Obama’s presidency.

The key disagreement is over taxes. Democrats, including Obama, say a major deficit-reduction agreement must include tax increases or the elimination of tax breaks for big companies and wealthy individuals. Republicans are demanding huge cuts in government spending and insisting there be no tax increases.

Absent an agreement that cuts long-term deficits, Republicans say they will not vote to increase the nation’s borrowing, which will exceed its $14.3 trillion limit on Aug. 2. The administration has warned that if Congress does not raise the debt ceiling, it could mean the first U.S. financial default in history and send economic shockwaves around the world.

Discussions led by Vice President Joe Biden that were designed to trim about $2 trillion from long-term deficits abruptly stalled this week, leading Obama to step in Friday and summon the top Senate leaders to the White House.

On Monday morning, Obama and Biden plan to meet with Senate Majority Leader Harry Reid, D-Nev., and in the early evening he will sit down with Senate Republican leader Mitch McConnell of Kentucky. McConnell and House Speaker John Boehner have repeatedly said that no deal can include tax hikes.

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3 Comments so far ↓

  • TAZ

    In the end a disaster will be averted.

    And by the Repubs walking away early in the process Obama will look like the adult in the room and get all the credit.

    Smart move my fellow repubs…….

  • medinnus

    The GOP has to maintain a hard line until the last minute, and even that is a bad choice of worse options. Idiot bag-sucking Tea Baggers deserve to be tossed out on their pointy heads.

  • parkesprag

    Obama needs to point out that ‘per some obvious experts within the Repub party (eg, DeMint), a ‘default’ won’t really hurt”.

    OK, so I guess that the THREAT of it has no bite either?

    So, why should he fold when by THEIR own analysis, THEIR threat is “harmless”…

    Cuts, yes, but NOT without shared sacrifice (ie, some tax revenues )…..

    So, blink, blink… someone, did I hear a blink?