WASHINGTON - Rival Democratic and Republican plans to raise the government's borrowing ability have thrust Congress into a standoff just one week away from a potentially devastating debt crisis. President Obama made a last ditch call for compromise, but House Speaker John Boehner said negotiations with the White House had been futile.
"We can't allow the American people to become collateral damage to Washington's political warfare," Obama declared Monday in a prime-time address to the nation.
CBS News senior White House correspondent Bill Plante says the speech was a last-minute decision at the White House, and it set up a shootout with Speaker Boehner, "the likes of which we have a rarely seen in the capital."
Boehner, in a nationally televised rebuttal, said he had given "my all" to work out a deal with Obama.
"The president would not take yes for an answer," he said.
The extraordinary back-to-back appeals to the public gave no indication that weeks of brinkmanship and sputtering talks over long-term deficit reductions were on the verge of ending. With an Aug. 2 deadline rapidly closing, Congress and the White House had limited options to avoid a potential government default that could send the already weak economy into a damaging swoon.
"Face the Nation" host Bob Schieffer said the leaders likely accomplished little with their prime-time drama.
"It seemed to me what was underlined last night is just how far apart the two sides are. There is a divide in the country over what to do about spending and what we want from government, and you are seeing that in the congress," said Schieffer.
"The problem," explained Schieffer Tuesday morning, "is you have got a lot of Republicans here who were elected last time on a promise of never, ever raising taxes. On the other side you have Democrats who promised never, ever to touch entitlement programs."
Both Democrats and Republicans softened previous hardline positions and appeared ready to leave quarrels over entitlement programs and higher tax revenues for later. But continued bickering on Capitol Hill overshadowed any signs of emerging common ground.
Obama reiterated his call for achieving lower deficits though spending cuts and new tax revenues. But in a notable retreat, he voiced support for a Senate Democratic plan that would reduce deficits by about $2.7 trillion over 10 years only with spending cuts, not with additional revenue.
The Senate plan, unveiled Monday by Senate Majority Leader Harry Reid, D-Nev., and the proposal announced the same day by Boehner overlap in significant ways. Both identify about $1.2 trillion in spending cuts to the day-to-day operating budgets of government agencies, though Reid's proposal also counts an extra $1 trillion in savings from winding down wars in Iraq and Afghanistan. Both proposals would create a bipartisan congressional commission to identify further deficit reductions, especially in major health care programs such as Medicare and Medicaid.
The primary difference between the two is timing. Reid's proposal would raise the debt ceiling enough so that it wouldn't have to be reconsidered until 2013, beyond the 2012 elections, as demanded by Obama. The GOP plan would only extend the debt ceiling for about six months.
For Republicans, the timing provides crucial leverage to force Democrats and the president to cut spending in Medicare, Medicaid and Social Security, expensive benefit programs that Democrats have long protected, despite escalating costs.
Obama has said he would not sign a short-term extension of the debt ceiling, but on Monday he stopped short of issuing a veto threat. Still, he said, a six-month-long increase in the debt ceiling would allow Republicans to try to force their will once again, demanding "harsh cuts" in program like Medicare and refusing to allow tax increases on the wealthy.
"Based on what we've seen these past few weeks, we know what to expect six months from now," he said. "Once again, the economy will be held captive unless they get their way."
Credit rating agencies such as Moody's and Standard & Poor's have threatened to downgrade the United States' gold-plated AAA rating if Congress and the White House don't extend the debt ceiling and take steps to bring long-term deficits under control.
While both plans would increase the debt ceiling, ratings agencies have said a short-term increase such as the one proposed by House Republicans may not be enough to protect the U.S. from a ratings downgrade. What's more, neither plan offers the larger deficit-reducing assurances that credit ratings have said they need for the U.S. to retain its place as one of the most secure investments in the world.
Until last week, Boehner had been negotiating with Obama for a deficit reduction package of up to $4 trillion that included spending reductions in Medicare, Medicaid and Social Security and provided for up to $800 billion in new tax revenue over 10 years.
But Boehner broke off those discussions after Obama asked for an additional $400 billion in tax revenue and after the two sides could not narrow the gap on other provisions.
"The sad truth is that the president wanted a blank check six months ago, and he wants a blank check today. That is just not going to happen," the speaker said.
In offering his new plan, Boehner had the backing of his top Republican leadership team. But he risked losing some potentially critical Republican votes by scaling back a bigger plan that passed the House and would have cut as much as $6 trillion. That plan failed in the Senate.
Rep. Jim Jordan of Ohio, one of the leading advocates of legislation that cleared the House last week and died in the Senate, said he could not support Boehner's new plan.
The the entire thing is a scam to get more money for Obama before he loses the election. Your check is consitutionaly required to be sent out. and he Knows it.! He's just trying to scare people into thinking that the goverment has NO MONEY LEFT. So when the checks go out he is going to take credit for "making sure He has saved the day"! The man can not tell the TRUTH about anything. He says that the rep's need to show him a plan and that they are the party of "no" that he knows best. And yet after at least 6 different plans he has dismissed because they wont go past the next election. Hary Reid wont even have a vote of the cut cap and balance plan that insits the goverment cut costs because to would probally pass and his "cronies" would have to look for a HONEST JOB. Any plan that passes both the senate and the house ( and ther is 3 that would!) will die at the desk, because are inept President Says he will "VETO" if it doesnt give him a blank check that lasts beyond Nov. 2012. I'm simply amazed that the man is still alive.
I think it is high time that Congress shared the pain with the rest of America. As U.S. workers have suffered layoffs, pay cuts and furloughs over the past two years, Congress has continued to receive automatic pay raises each year.
The notion of cutting Congressional pay is wildly popular. A recent survey by the Rasmussen Reports found that 75% of Americans think members of Congress should cut their pay until the budget is balanced. And nearly one in eight think members of Congress should not be able to get a raise unless taxpayers vote for it.
As things stand, members of Congress set their own pay and they've been quite generous. Rank and file members of congress now earn $174,000 annually - more than about 97% of the rest of the country. That's up 23% over the past decade.
When giving themselves generous raises began to spark public ire, legislators passed a bill to make annual pay hikes for Congress automatic. There has not been a Congressional pay cut in 77 years - since the Great Depression.
It's worth mentioning that cutting Congressional pay would still be generous. In addition to their $174,000 annual salaries ($193,400 for House and Senate leadership), all members of Congress have discretionary office accounts worth roughly $1.5 million and travel at the public's expense. And that's just the tip of the iceberg. Congressional perks, though scaled back bit over the past decade, are still rich enough to make you drool.
So what's the hold up in cutting Congressional pay? Congress, of course.
Members of Congress are doing what they always do when there is a popular bill that they want to kill. They're ignoring it. That allows the bill to die quietly of neglect.
To pass legislation, you must get it heard in committee and then have the bill brought to the floor of the House for a vote. But if it's brought for a vote - particularly in an election year - everyone will know who voted against it. If you don't want to do something that politically unpopular, you simply don't schedule the bill for a hearing. It never gets voted on at all. The term of art for this process is called letting a bill "die in committee."
The benefit of that? No elected leader has to cope with the unpleasant consequences of telling the American people with actions (which speak louder than than words): "We don't feel your pain and we don't want to."
The only real entitlements are the outrageous welfare in the form of tax breaks we give to the filthy rich and the giant corporations. THAT is the giant sucking sound (along with our middle class jobs going bye bye.
We PAID for our social security, pensions, etc. It is the greedy rich who don't work!
It's troubling to find Americans who are this poorly informed and this greedy. Benefits paid under Social Security, Medicaid and other entitlement programs (sorry, but that's what they're actually CALLED) are unrelated to payroll taxes if any paid during the recipient's working life. So it is nonsense to say "we PAID" for those things; the truth is, you didn't. The truth is that fewer and fewer workers, now, are being taxed more and more to pay for benefits handed to others who may well be better off than the person paying the tax. This is indefensible on moral grounds.
Second, it is foolish to refer to "tax breaks we give to the filthy rich and the giant corporations." Do you even know what "tax breaks" you mean? The US corporate tax rate is higher than any other nation in the developed world. People making over $250,000 are NOT "filthy rich" and DO work. But they pay more than 40% of all personal income taxes.
It is not "greedy" to say that 40% might be enough. It IS greedy to say, "I don't care what they pay, I want them to pay more and more, so I can get more and more." That's you. That's greedy.
Take It to the Bank & the King with no clothes is facing the naked truth.
The President's Plan - No Plan, chaos, and anarchy. He has never had a concept of operation except to regurgitate a strategy orchestrated by the Open Society Institute; recite the script provided by the Center for American Progress; and hang out with elitist illuminati, eat grapes and be "fanned".
The strategy & a world managed as a hedge fund managed by an aging megalomaniac, George Soros.
If we reined in our spending and actually balance our budget this problem would begin to end. We have to start some time. Raising the ceiling and continued wasteful spending IS only kicking the can down the road, as Prez. Obama likes to say. So, stop kicking the can. We need reforms and is should come on the backs of those who have not donated to the making of the bread. Push has come to shove and the contributors must speak up to drowned out the noisy non-contributors. We will have to examine our priorities. If you've paid into the system your deserve to reap your rewards. If you have not, it's time to get to work and off your butt.
1. The GOP represent only the wealthy in this country 2. The GOP will lie to not have the Bush tax loop holes to go away 3. The GOP gives not a crap about the middle-class and average American 4. The GOP agenda is to keep the poor and middle class voters at odds so that the rich can control the country and have cheap labor
My personal opinion: 1. Social Security should NOT be cut. 2. Medicare should NOT be cut. 3. All other Budget Items are subject to fair, judicious reduction. 4. An increase in taxes for those making above $250,000 is inevitable and should be done immediately.
$250,000.00 spare them they are paupers.. STAR exemptions are no longer available for those who work and make $500,000. or more... but get this if you are retired and have pension income of $70,000.00 you loose your STAR exemtion..... why d0 you loose a tax exemption when your income is $430,000. less .So it would seem to me that if your retired and get a $70,000, pension you have to pay your full real estate tax on your home but if you are working and make $490,000. you get a tax break.....this is now in effect.... Tax the rich according to the GOP it will cost jobs.... the opposite is true Reagans "trickle down" economics were incorrectly named..those rich folks at the top got richer when he raised taxes... it was a "trikle up" economy. When Nelson Rockerfeller was appointed vice president his taxes were published in the local newspaper for that year he paid $2100.n fed income tax. My dad who was a food service manager for a college was reading the paper and was outraged that he paid $2600. fed income tax that same year......tax the rich they will only get it back from us when we buy their products and or services
the majority of americans do not support the republicans agenda when it comes to social security and medicare cuts ... so it would seem that the republican agenda is being supported by only a minority of Americans... when a white minority ruled a country whose majority was non white it was unspeakable and political suicide to suppoert the concept of minority rule......Oh yeah heres a great concept... "Government of the People . by the People and For the People" .......
How we got here is complex. How we get out is even worse. My concern is that Americans will suffer terribly because of this scenario. Let me lay out the potential scenario. We default, our rating drops, global markets start to take a downward trajectory. Each market negatively impacts the next and we end up in a global depression. This scenario is viewed by rogue nations as the prime opportunity to strike in an attempt to start a global war issuing in the final of the twelve Imams.
Think it can't happen? Look it up in wikipedia. There is more at stake here than just cash friends.
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The notion of cutting Congressional pay is wildly popular. A recent survey by the Rasmussen Reports found that 75% of Americans think members of Congress should cut their pay until the budget is balanced. And nearly one in eight think members of Congress should not be able to get a raise unless taxpayers vote for it.
As things stand, members of Congress set their own pay and they've been quite generous. Rank and file members of congress now earn $174,000 annually - more than about 97% of the rest of the country. That's up 23% over the past decade.
When giving themselves generous raises began to spark public ire, legislators passed a bill to make annual pay hikes for Congress automatic. There has not been a Congressional pay cut in 77 years - since the Great Depression.
It's worth mentioning that cutting Congressional pay would still be generous. In addition to their $174,000 annual salaries ($193,400 for House and Senate leadership), all members of Congress have discretionary office accounts worth roughly $1.5 million and travel at the public's expense. And that's just the tip of the iceberg. Congressional perks, though scaled back bit over the past decade, are still rich enough to make you drool.
So what's the hold up in cutting Congressional pay? Congress, of course.
Members of Congress are doing what they always do when there is a popular bill that they want to kill. They're ignoring it. That allows the bill to die quietly of neglect.
To pass legislation, you must get it heard in committee and then have the bill brought to the floor of the House for a vote. But if it's brought for a vote - particularly in an election year - everyone will know who voted against it. If you don't want to do something that politically unpopular, you simply don't schedule the bill for a hearing. It never gets voted on at all. The term of art for this process is called letting a bill "die in committee."
The benefit of that? No elected leader has to cope with the unpleasant consequences of telling the American people with actions (which speak louder than than words): "We don't feel your pain and we don't want to."
We PAID for our social security, pensions, etc. It is the greedy rich who don't work!
Second, it is foolish to refer to "tax breaks we give to the filthy rich and the giant corporations." Do you even know what "tax breaks" you mean? The US corporate tax rate is higher than any other nation in the developed world. People making over $250,000 are NOT "filthy rich" and DO work. But they pay more than 40% of all personal income taxes.
It is not "greedy" to say that 40% might be enough. It IS greedy to say, "I don't care what they pay, I want them to pay more and more, so I can get more and more." That's you. That's greedy.
The President's Plan - No Plan, chaos, and anarchy. He has never had a concept of operation except to regurgitate a strategy orchestrated by the Open Society Institute; recite the script provided by the Center for American Progress; and hang out with elitist illuminati, eat grapes and be "fanned".
The strategy & a world managed as a hedge fund managed by an aging megalomaniac, George Soros.
1. The GOP represent only the wealthy in this country
2. The GOP will lie to not have the Bush tax loop holes to go away
3. The GOP gives not a crap about the middle-class and average American
4. The GOP agenda is to keep the poor and middle class voters at odds so that the rich can control the country and have cheap labor
1. Social Security should NOT be cut.
2. Medicare should NOT be cut.
3. All other Budget Items are subject to fair, judicious reduction.
4. An increase in taxes for those making above $250,000 is inevitable and should be done immediately.
Think it can't happen? Look it up in wikipedia. There is more at stake here than just cash friends.