WASHINGTON—House Speaker John Boehner’s debt-reduction plan appeared to be gaining support among House Republicans as the United States inches closer to the Aug. 2, Treasury-imposed deadline for raising the debt ceiling.
While many House Republicans have begun to voice their support for the plan as the debt deadline nears, Boehner is still facing criticism from the hardcore conservative, Tea Party wing of his caucus, which is claiming that the spending cuts in the speaker’s plan are nowhere near enough.
Speaking on conservative commentator Laura Ingraham’s radio show, Boehner said that he had, in a closed meeting, ordered House GOP lawmakers to “get your ass in line” and support his two-stage plan for raising the debt ceiling and cutting federal spending.
The increased support from House Republicans is materializing in spite of a report released by the Congressional Budget Office (CBO) on Tuesday, which concluded that Boehner’s plan actually cuts less spending than he had originally claimed. The report reveals that the plan cuts federal spending by $850 billion over the next 10 years, rather than the $1.2 trillion claimed by the speaker.
While Boehner had originally prepared to bring his plan to a House floor vote on Wednesday, the CBO report forced him and his staff to find additional spending cuts elsewhere, and to postpone a vote on the plan until Thursday at the earliest.
Meanwhile, a similar report by the CBO revealed that Senate Majority Leader Harry Reid’s debt-reduction plan actually makes more cuts than Boehner’s House plan. The CBO report concludes that Reid’s plan would cut $2.2 trillion from federal expenditures over the next decade, which is short of the $2.7 trillion that Reid had originally claimed.
In addition, about half of Reid’s cuts would result from ending the wars in Iraq and Afghanistan, which Republicans criticize as an accounting gimmick. The other cuts in Reid’s plan consist mostly of cuts in discretionary spending and federal agency budgets.
However, even with war spending taken out of the equation, a side-by-side comparison reveals that Reid’s cuts, amounting to roughly $900 billion, still exceeds Boehner’s cuts of about $850 billion.
In a July 27, news conference, Reid reiterated his belief that his plan was a compromise that Republicans could get behind.
“The Senate bill was written to take care of the problems that Democrats said they had, and the Republicans said they had. It meets our goals to protect Social Security and Medicare,” said Reid. “But it also satisfies two major demands Republicans have made. It doesn’t contain revenues, and the amount of cuts [exceeds the size of the debt-ceiling increase].”
The stock markets also plunged on Wednesday as the country nears the Aug. 2, debt-ceiling deadline. All three of the major stock indices took severe hits, as the S&P 500 fell 27.05 points, or 2 percent, to 1,304.89.
The Dow Jones Industrial Average fell 198.75 points, or 1.6 percent, to 12,302.55, while the technology-heavy Nasdaq Composite index fell 75.17 points, or 2.6 percent, to 2,764.79.
Also, the “big three” credit rating agencies of Standard & Poor’s, Moody’s Investor Service, and Fitch Ratings have all repeated their threats to downgrade the U.S. sovereign credit rating if the debt crisis is not resolved.
Given the threat and severe consequences of a potential failure to raise the debt ceiling, some House Democrats have suggested that President Barack Obama invoke a clause in the 14th Amendment of the United States Constitution, which they claim would allow the president to unilaterally raise the debt ceiling with or without congressional approval.
The text in question states, “The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.”
House Democrats have interpreted this to mean that the president has the power to raise the debt ceiling without congressional approval, but the White House thus far has maintained that it does not subscribe to this point of view.
“The president does not have the authority to raise the debt ceiling,” said White House Press Secretary Jay Carney in Wednesday’s White House press briefing.
While many House Republicans have begun to voice their support for the plan as the debt deadline nears, Boehner is still facing criticism from the hardcore conservative, Tea Party wing of his caucus, which is claiming that the spending cuts in the speaker’s plan are nowhere near enough.
Speaking on conservative commentator Laura Ingraham’s radio show, Boehner said that he had, in a closed meeting, ordered House GOP lawmakers to “get your ass in line” and support his two-stage plan for raising the debt ceiling and cutting federal spending.
The increased support from House Republicans is materializing in spite of a report released by the Congressional Budget Office (CBO) on Tuesday, which concluded that Boehner’s plan actually cuts less spending than he had originally claimed. The report reveals that the plan cuts federal spending by $850 billion over the next 10 years, rather than the $1.2 trillion claimed by the speaker.
While Boehner had originally prepared to bring his plan to a House floor vote on Wednesday, the CBO report forced him and his staff to find additional spending cuts elsewhere, and to postpone a vote on the plan until Thursday at the earliest.
Meanwhile, a similar report by the CBO revealed that Senate Majority Leader Harry Reid’s debt-reduction plan actually makes more cuts than Boehner’s House plan. The CBO report concludes that Reid’s plan would cut $2.2 trillion from federal expenditures over the next decade, which is short of the $2.7 trillion that Reid had originally claimed.
In addition, about half of Reid’s cuts would result from ending the wars in Iraq and Afghanistan, which Republicans criticize as an accounting gimmick. The other cuts in Reid’s plan consist mostly of cuts in discretionary spending and federal agency budgets.
However, even with war spending taken out of the equation, a side-by-side comparison reveals that Reid’s cuts, amounting to roughly $900 billion, still exceeds Boehner’s cuts of about $850 billion.
In a July 27, news conference, Reid reiterated his belief that his plan was a compromise that Republicans could get behind.
“The Senate bill was written to take care of the problems that Democrats said they had, and the Republicans said they had. It meets our goals to protect Social Security and Medicare,” said Reid. “But it also satisfies two major demands Republicans have made. It doesn’t contain revenues, and the amount of cuts [exceeds the size of the debt-ceiling increase].”
The stock markets also plunged on Wednesday as the country nears the Aug. 2, debt-ceiling deadline. All three of the major stock indices took severe hits, as the S&P 500 fell 27.05 points, or 2 percent, to 1,304.89.
The Dow Jones Industrial Average fell 198.75 points, or 1.6 percent, to 12,302.55, while the technology-heavy Nasdaq Composite index fell 75.17 points, or 2.6 percent, to 2,764.79.
Also, the “big three” credit rating agencies of Standard & Poor’s, Moody’s Investor Service, and Fitch Ratings have all repeated their threats to downgrade the U.S. sovereign credit rating if the debt crisis is not resolved.
Given the threat and severe consequences of a potential failure to raise the debt ceiling, some House Democrats have suggested that President Barack Obama invoke a clause in the 14th Amendment of the United States Constitution, which they claim would allow the president to unilaterally raise the debt ceiling with or without congressional approval.
The text in question states, “The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.”
House Democrats have interpreted this to mean that the president has the power to raise the debt ceiling without congressional approval, but the White House thus far has maintained that it does not subscribe to this point of view.
“The president does not have the authority to raise the debt ceiling,” said White House Press Secretary Jay Carney in Wednesday’s White House press briefing.
