Obama Stresses Substantive, Balanced Budget Deal

As the Aug. 2 Treasury deadline for raising the $14.3 trillion debt ceiling looms ever closer, marked shifts in rhetoric have again occurred on both sides of the budget talks while Congress returned to work after the Fourth of July weekend.

Giving a short speech to reporters on Tuesday, President Barack Obama voiced his belief that any budget compromise struck between the two sides should deal substantively with the debt and deficit. He stated that the two sides needed to deal with these tough decisions sooner rather than later. The president admonished those in Congress who have proposed doing just enough to avoid defaulting on the debt in the short term, while kicking the can down the road.

“I don’t think the American people sent us here to avoid tough problems,” said Obama. “That’s in fact what drives them nuts about Washington, when both parties simply take the path of least resistance, and I don’t want to do that here.”

The president also stressed the need for a balanced approach to dealing with the deficit and cutting spending, putting all segments of the budget on the chopping block.

“We need to take on spending in domestic programs, in defense programs, in entitlement programs, and we need to take on spending in the tax code—spending on certain tax breaks and deductions for the wealthiest of Americans. This will require both parties to get out of our comfort zones,” he said.

In the same speech, Obama invited congressional leaders of both houses and parties to the White House for further negotiations, asking that both sides leave their ultimatums and political rhetoric at the door in order to do what is necessary to put the country back on the road to fiscal sustainability. Congressional Republicans accepted the invitation and will meet Obama on Thursday.

Meanwhile, Senate Republicans reiterated their commitment to cut and restrain what they see as out-of-control Washington spending. After voting to pull a Senate debate on the Libyan conflict in favor of debating the debt limit, six Senate Republicans held an afternoon press conference in which they discussed the importance of a balanced-budget amendment to the Constitution and caps on federal spending.

Sen. Ron Johnson (R-Wis.) touted these potential measures as a way to enforce fiscal discipline on the federal government:

“You’ve got to have those caps, you’ve got to have a constitutional limit to not only force Washington to prioritize spending, but quite honestly, to make Americans also realize that you’ve got to prioritize spending,” said Johnson. “I think it is a two-step process. You first have to put that discipline in place, then you’ve got to do the hard work of prioritizing spending.”

Despite the hard-line insistence on the need for spending caps and a balanced-budget amendment, congressional Republicans appeared to be more open to other measures such as tax increases and closing tax loopholes. Sen. Jeff Sessions (R-Ala.) expressed willingness to consider tax increases if their effects are fully analyzed by the Senate Finance Committee and found acceptable.

House Majority Leader Eric Cantor (R-Va.), in his weekly roundtable with reporters on Wednesday also conceded that he would consider the idea of closing tax loopholes, as long as those losses were offset by tax cuts elsewhere.