Declaring "11th hour" urgency" to raise the
government's borrowing limit, President Barack
Obama on Tuesday hailed a plan by "Gang of Six"
senators from both parties to reduce federal deficits
as the kind of balanced approach that could break the
economy-threatening deadlock. He said it was time
for Congress to rally around such a proposal.
"We don't have any more time to engage in symbolic
gestures, we don't have any more time to posture. It's
time to get down to the business of actually solving
this problem," the president said.
Obama spoke even as House Republicans pushed
toward a vote on separate legislation that would
require trillions in spending cuts and agreement on a
balanced-budget constitutional amendment in
exchange for an increase in the debt ceiling, which
the government says must be raised by Aug. 2 to
avoid economic calamity. That House plan, expected
to come to a vote Tuesday evening, was unlikely to
get through the Senate, and Obama has said he would
veto it if it ever arrived at his desk.
Facing the deadline in two weeks, Obama said he
would call House Speaker John Boehner after
Tuesday's vote to invite him and other leaders back to
the White House for meetings in coming days.
Obama, Boehner and other top leaders met last week
for five days straight without reaching agreement,
leading to warnings from credit agencies about dire
consequences if the U.S. defaults on its obligations
for the first time, rendering it unable to pay its bills.
Obama added his own warning Tuesday, saying that
while financial markets have shown confidence thus
far in Washington, it won't last much longer if
lawmakers fail to act.
But he found cause for optimism in the announcement
Tuesday by leaders of a bipartisan "Gang of Six"
senators that they're nearing agreement on a major
plan to cut the deficit by more than $4 trillion over
the coming decade.
"I think it's a very significant step," Obama said,
calling it "broadly consistent with the approach I've
urged."
government's borrowing limit, President Barack
Obama on Tuesday hailed a plan by "Gang of Six"
senators from both parties to reduce federal deficits
as the kind of balanced approach that could break the
economy-threatening deadlock. He said it was time
for Congress to rally around such a proposal.
"We don't have any more time to engage in symbolic
gestures, we don't have any more time to posture. It's
time to get down to the business of actually solving
this problem," the president said.
Obama spoke even as House Republicans pushed
toward a vote on separate legislation that would
require trillions in spending cuts and agreement on a
balanced-budget constitutional amendment in
exchange for an increase in the debt ceiling, which
the government says must be raised by Aug. 2 to
avoid economic calamity. That House plan, expected
to come to a vote Tuesday evening, was unlikely to
get through the Senate, and Obama has said he would
veto it if it ever arrived at his desk.
Facing the deadline in two weeks, Obama said he
would call House Speaker John Boehner after
Tuesday's vote to invite him and other leaders back to
the White House for meetings in coming days.
Obama, Boehner and other top leaders met last week
for five days straight without reaching agreement,
leading to warnings from credit agencies about dire
consequences if the U.S. defaults on its obligations
for the first time, rendering it unable to pay its bills.
Obama added his own warning Tuesday, saying that
while financial markets have shown confidence thus
far in Washington, it won't last much longer if
lawmakers fail to act.
But he found cause for optimism in the announcement
Tuesday by leaders of a bipartisan "Gang of Six"
senators that they're nearing agreement on a major
plan to cut the deficit by more than $4 trillion over
the coming decade.
"I think it's a very significant step," Obama said,
calling it "broadly consistent with the approach I've
urged."
The Gang of Six plan calls for an immediate $500
billion "down payment" on cutting the deficit as the
starting point toward cuts of more than $4 trillion
that would be finalized in a second piece of
legislation. It would raise revenues by about $1
trillion over 10 years and cut popular benefit
programs like Medicare and Medicaid — dealing out
political pain to Republicans and Democrats.
That mixture of cuts and new revenue is the "balanced
approach" Obama has urged, though it's rejected by
many Republicans because it would require higher
taxes for some.
Rep. Dave Camp, Republican chairman of the House
Ways and Means Committee, said the spending cuts
and budget mechanisms in the plan could form the
basis of a deal but tax increases would be a big
problem for him and fellow GOP lawmakers.
"A trillion dollars is a lot, by any measure," Camp said
of the tax increases in the plan.
While praising the broader plan, Obama said it was
still important to have a "Plan B" option being worked
on by Senate Majority Leader Harry Reid and Senate
Minority Leader Mitch McConnell as a fallback. The
McConnell-Reid plan would give Obama the ability to
raise the debt limit by $2.5 trillion in three
billion "down payment" on cutting the deficit as the
starting point toward cuts of more than $4 trillion
that would be finalized in a second piece of
legislation. It would raise revenues by about $1
trillion over 10 years and cut popular benefit
programs like Medicare and Medicaid — dealing out
political pain to Republicans and Democrats.
That mixture of cuts and new revenue is the "balanced
approach" Obama has urged, though it's rejected by
many Republicans because it would require higher
taxes for some.
Rep. Dave Camp, Republican chairman of the House
Ways and Means Committee, said the spending cuts
and budget mechanisms in the plan could form the
basis of a deal but tax increases would be a big
problem for him and fellow GOP lawmakers.
"A trillion dollars is a lot, by any measure," Camp said
of the tax increases in the plan.
While praising the broader plan, Obama said it was
still important to have a "Plan B" option being worked
on by Senate Majority Leader Harry Reid and Senate
Minority Leader Mitch McConnell as a fallback. The
McConnell-Reid plan would give Obama the ability to
raise the debt limit by $2.5 trillion in three
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Obama Praises 'Gang' Plan as Debt Debate Begins
installments over the next year without a separate
vote by lawmakers. Instead, a panel of House and
Senate members would be created to recommend cuts
in benefit programs, with their work guaranteed a
yes-or-no vote in the House or Senate.
While all that was going on behind the scenes,
advocates of the legislation to be voted on in the
House on Tuesday said it would cut spending by an
estimated $111 billion in the next budget year and
then by more than an additional $6 trillion over a
decade — and require Congress to send a balanced
budget amendment to the Constitution to the states
for ratification — in exchange for raising the debt
limit by $2.4 trillion.
With the measure facing a veto threat from the White
House, Boehner said he was exploring other
alternatives to avoid government default.
"I do think it's responsible for us to look at what Plan
B would look like," he said at a news conference a few
hours before the opening of debate on the legislation
backed by conservative lawmakers.
Said Obama: "The problem we have now is, we're in
the 11th hour, and we don't have a lot more time left."
On a day of political theater, a group of House
Republicans also boarded a bus for a 16-block ride
to deliver a letter asking Obama to disclose his own
plan for reducing federal deficits.
No administration officials were present to meet the
delegation when the bus rolled to a stop outside the
White House gates, and lawmakers gave copies of the
letter to reporters.
Democrats said it was urgent that the debt ceiling be
raised.
In a closed-door meeting in the Capitol, House
Democrats listened to an audio of Republican
President Ronald Reagan urging lawmakers in 1987
to raise the debt limit. "This brinkmanship threatens
the holders of government bonds and those who rely
on Social Security and veterans' benefits," he said
then.
Nearly a quarter of a century — and numerous
trillions of dollars in debt — later, Obama needs
acquiescence from the Republican-controlled House
and the Democratic-controlled Senate to win another
debt ceiling increase. So far, efforts to agree on a
package of spending cuts — the price demanded by
GOP lawmakers for their votes — have proved futile.
vote by lawmakers. Instead, a panel of House and
Senate members would be created to recommend cuts
in benefit programs, with their work guaranteed a
yes-or-no vote in the House or Senate.
While all that was going on behind the scenes,
advocates of the legislation to be voted on in the
House on Tuesday said it would cut spending by an
estimated $111 billion in the next budget year and
then by more than an additional $6 trillion over a
decade — and require Congress to send a balanced
budget amendment to the Constitution to the states
for ratification — in exchange for raising the debt
limit by $2.4 trillion.
With the measure facing a veto threat from the White
House, Boehner said he was exploring other
alternatives to avoid government default.
"I do think it's responsible for us to look at what Plan
B would look like," he said at a news conference a few
hours before the opening of debate on the legislation
backed by conservative lawmakers.
Said Obama: "The problem we have now is, we're in
the 11th hour, and we don't have a lot more time left."
On a day of political theater, a group of House
Republicans also boarded a bus for a 16-block ride
to deliver a letter asking Obama to disclose his own
plan for reducing federal deficits.
No administration officials were present to meet the
delegation when the bus rolled to a stop outside the
White House gates, and lawmakers gave copies of the
letter to reporters.
Democrats said it was urgent that the debt ceiling be
raised.
In a closed-door meeting in the Capitol, House
Democrats listened to an audio of Republican
President Ronald Reagan urging lawmakers in 1987
to raise the debt limit. "This brinkmanship threatens
the holders of government bonds and those who rely
on Social Security and veterans' benefits," he said
then.
Nearly a quarter of a century — and numerous
trillions of dollars in debt — later, Obama needs
acquiescence from the Republican-controlled House
and the Democratic-controlled Senate to win another
debt ceiling increase. So far, efforts to agree on a
package of spending cuts — the price demanded by
GOP lawmakers for their votes — have proved futile.
Barring action by Congress to raise the $14.3 trillion
debt ceiling, the Treasury will be unable to pay all the
government's bills that come due beginning Aug. 3.
Administration officials, Federal Reserve Chairman
Ben Bernanke and others say the resulting default
would inflict serious harm on the economy, which is
still struggling to recover from the worst recession in
decades.
Reid announced Monday that the Senate would meet
each day until the issue was resolved, including
weekends.
———
Associated Press writers Erica Werner, Stephen
Ohlemacher, Darlene Superville and David Espo
contributed to this article.
debt ceiling, the Treasury will be unable to pay all the
government's bills that come due beginning Aug. 3.
Administration officials, Federal Reserve Chairman
Ben Bernanke and others say the resulting default
would inflict serious harm on the economy, which is
still struggling to recover from the worst recession in
decades.
Reid announced Monday that the Senate would meet
each day until the issue was resolved, including
weekends.
———
Associated Press writers Erica Werner, Stephen
Ohlemacher, Darlene Superville and David Espo
contributed to this article.
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