Amid growing anger, debt limit debate drags on

Senate Minority Leader Mitch McConnell of Ky. looks on at right, as President Barack Obama meets with Congressional leaders regarding the debt ceiling, Wednesday, July 13, 2011, in the Cabinet Room of the White House in Washington.

/ AP Photo/Charles Dharapak

The date at which the Obama administration and most economists say the United States - and the world - faces economic catastrophe without a deal to raise the debt ceiling is less than three weeks away. Lawmakers are still far apart on a deal, with a contentious meeting yesterday ending with President Obama abruptly walking out.

So how did the top leaders in Washington spend much of their day Thursday? By lobbing insults at each other and holding public events seemingly grounded in considerations more political than practical.

Lawmakers will meet again late Thursday afternoon to try to hammer out a deal to increase the nation's $14.3 debt ceiling - the limit, set by Congress, on how much money the United States can borrow. Republicans, who control the House of Representatives, have said they will only vote to increase the debt limit in exchange for a deficit-reduction package larger than the amount of the increase. Democrats are in favor of such a package, but there is a major point of contention between the parties: Republicans want the package to include only spending cuts, while Democrats say it must also include revenue increases as well. And boxed in by their base, neither side has been willing to budge.

If the debt ceiling is not increased by August 2, the administration says, the United States will no longer to be able to pay its obligations, potentially resulting in default to creditors, the suspension of Social Security checks and other benefits, an increase in interest rates and a host of other extremely serious and negative economic consequences. Administration officials have suggested a deal must be in place by roughly July 22 in order to get a deal through Congress in time. On Wednesday, ratings agency Moody's put the United States' Aaa bond rating under review for possible downgrade as the deadline approaches; Thursday, Treasury Secretary Timothy Geithner said bluntly, "we're running out of time."  (You can read a primer on the debt limit fight here.)

It's not entirely clear what took place in Wednesday's two hour, closed-door meeting, with both Republicans and Democrats trying to spin it to make their side look good. But there is little doubt that those involved showed signs of frustration. After House Majority Leader Eric Cantor pressed the president to consider a short-term debt limit extension - something the president has ruled out - Mr. Obama left the meeting, saying "enough is enough."

Sources say Mr. Obama also told Cantor not to try to "call my bluff," while a GOP aide said House Speaker John Boehner pointedly said in response to an effort to use budgetary gimmicks to reach a deal, "We're not doing that anymore."

Despite that, Boehner has emerged during the debate as the Republican leader most willing to compromise, working with Mr. Obama on a "grand bargain" deal to reduce the deficit by $4 trillion over a decade. (That attempt fell apart last weekend, though the White House is still pushing for it; the goal has now been pushed back to a less ambitions $2 trillion deal.) Cantor, by contrast, has been cast as a hard-liner unwilling to give an inch, making him the emerging hero of Tea Party-backed freshmen and prompting chatter of a split in the GOP leadership.

Democrats spent the day casting Cantor as a petulant crybaby, with Senate Majority Leader Harry Reid calling him "childish" and saying Cantor "has shown he shouldn't even be at the table." Sen. Charles Schumer, meanwhile, disputed Cantor's claim that there is no deficit reduction deal that can pass the House and suggested that Cantor is "the only real person who has not made any concessions."

"He is basically standing in the way, and it's a shame," Schumer said.

Meanwhile, Boehner, Cantor and other Republicans held a press conference to push for a balanced budget amendment - something that virtually no one expects can be included in a debt limit deal, especially considering that it would require a two-thirds majority in both houses of Congress. Boehner defended Cantor against Democratic criticism, saying claims that "the role he has played in these meetings has been anything less than helpful is just wrong."

At the White House, Press Secretary Jay Carney played down expectations for Thursday's meeting, saying, "I do not expect today a hallelujah moment." He called suggestions that Mr. Obama had stormed out of Wednesday's meeting "preposterous," describing the meetings as "reasonably collegial and respectful."

All parties involved in the negotiations say there will be a deal to raise the debt ceiling one way or another, though no one seems quite sure how to get there. The idea seen as the most likely to result in a breakthrough is one involving a tax reform package acceptable to at least some hard liners on both sides; barring that, the White House has signaled openness to Senate Majority Leader Mitch McConnell's "back-up plan" to effectively hand responsibility for raising the debt ceiling over to Mr. Obama. McConnell said Thursday that when it comes to debt ceiling issues, the president should not "expect any more cover from Republicans on it than you got on health care. None." That effectively translates to a promise of zero support from the GOP, since no Republicans voted for the final version of the health care overhaul.

Meanwhile, cracks in the Republican coalition continued to show as a result of the deal, with Wall Street splitting with the Tea Party in calling for a deal to get done.

"No one can tell me with certainty that a U.S. default wouldn't cause catastrophe and wouldn't severely damage the U.S. or global economy," JP Morgan Chase CEO Jamie Dimon said Thursday. "And it would be irresponsible to take that chance."

[HazeGabriel]

YOU ARE BEING MANIPULATED YOU SILLY FOOLS!!!!!

http://gabrielhaze.blogspot.com/2011/08/you-have-been-manipulated-and-you-dont.html

[Alex_Votocracy]

Tired of all this right vs left, dems vs Repubs debating? Wish politicians would do what's best for our country in general? Now you can vote into the whitehouse someone of your choosing... http://******/Votocracy

[George_Vreeland_Hill]

Dear Congress:
Last year I mismanaged my funds and this year my family and I cannot decide on a budget.
Until we can come to a unified decision that fits all of our needs and interests, we will have to shut down our check book and will no longer be able to pay our taxes.
I'm sure you'll understand.
Thank you very much for setting an example we can all follow.

George Vreeland Hill

[OBSERVING2011]

Driving us over the cliff to make a point is a symptom of insanity. The market is already going south and will take pensions and 401Ks with it. What does this have to do with job creation? Pass the debt ceiling, stop poilitical posturing, and get some balance in taxes and cuts in achieving deficit reductions in the coming year. We teach kids the concept of compromise but some of the Republican House members especially the Tea Party take no prisoners group missed that lesson in 3rd grade.Put that balanced budget amendment in the trash can and start using good judgement

[OBSERVING2011]

Driving us over the cliff to make a point is a symptom of insanity. The market is already going south and will take pensions and 401Ks with it. What does this have to do with job creation? Pass the debt ceiling, stop poilitical posturing, and get some balance in taxes and cuts in achieving deficit reductions in the coming year. We teach kids the concept of compromise but some of the Republican House members especially the Tea Party take no prisoners group missed that lesson in 3rd grade.Put that balanced budget amendment in the trash can and start using good judgement

[OBSERVING2011]

Driving us over the cliff to make a point is a symptom of insanity. The market is already going south and will take pensions and 401Ks with it. What does this have to do with job creation? Pass the debt ceiling, stop poilitical posturing, and get some balance in taxes and cuts in achieving deficit reductions in the coming year. We teach kids the concept of compromise but some of the Republican House members especially the Tea Party take no prisoners group missed that lesson in 3rd grade.Put that balanced budget amendment in the trash can and start using good judgement

[jackgotney]

we should work on a constitutional amendment to introduce suond fiscal principals. 1. Live within your means (i.e. budget). 2. If you need more money then be sure the project you wish to sponsor will be justified based on a payback (i.e. it will pay for itself).
Personally I am more terrified by our debt and lack of fiscal common sense than I am of the evil Taliban. I never really approved of half of how the gov spends our money. War, foolish bridges to nowhere etc... hardly a penny for education which was the top priority for our budget back in the 19th century. Now it is close to the bottom. If they don't resolve to pay down our entire debt within my lifetime (probably another 40 years) I plan to move to Canada. It ain't gonna be my problem. You realize they have been recklessly spending beyond their means and the burden is upon us tax payers to pay it back. And look what they have done with that moeny. They have wasted it. They gave 10 billion to Saddam Hussein, they've been giving money to Pakistan, to the Hamass, to Isreal, to Latin American countries. They are so generous with our money it makes me sick. I think that in addition to separation of church and state, we should also make sure there is a wall that separates politicians and political parties from state. They are as bad as the clergy.

[GVS27]

It's nice that the clowns in Washington can gamble with our collective futures. If they do manage to tank the economy, they will all still have their jobs (at least until the next election) and their retirement benefits will remain intact. They have no worries except preserving their own egos. This is WRONG and we all need to remember this come the next election. They all must go.

[dlw61]

since when is it legal to pay for ins (SS) for 20-40 YEARS and then told too bad your not covered!!! why would we target medicaid and social security when we can just look at our govt officials for ways to cut back spending. answer is - you work you get paid, you dont work you dont get paid! pretty simple
1.want to hear from ANYONE in the "real" world that can work 2-4 yrs and get paid a pension for the rest of their life???
2.want to know who pays medical insurance AFTER you stop working???
3. want to know why our military is paid almost 1/10th of what our politicians get!
4. want to know who gets unlimited sick days and almost 70 days vacation!
5. want to know how i can get a job and get paid forever, take all those days off, and still perform poorly and remain in that job!

but lets target the elderly and the poor to make cut backs- YEAH THAT MAKES SENSE!

im just an everyday person who lives paycheck to paycheck -maybe im missing something here but it makes NO sense whatsoever to me why the american people are screaming from the rooftops! i dont care how rich or poor you are what congress is doing is WRONG!

[agnesdeo]

STILL WAITING!!!! When will Prez Obama or the Democrats put in writing, put in print their answers to stop this national budget crisis??? What are they waiting for????
At least the GOP has presented at least 2 plans in writing so that we citizens can read and decide.
What are the democrats so fearful of?????