2 parties hold firm on how to reduce debt
GOP wants spending cuts; Dems push for tax boosts
5/21/2012WASHINGTON — Republicans and Democrats are refusing to budge from their positions on spending cuts versus tax increases to deal with the nation’s debt.
House Speaker John Boehner (R., Ohio) and Senate Minority Leader Mitch McConnell (R., Ky.) both said Sunday that when Congress is asked to raise the nation’s borrowing cap after the election, they’ll insist on spending cuts to offset the increase.
Democratic leaders countered that the GOP stance is irresponsible, given that the partisan showdown over the debt ceiling last year caused a downgrading of the U.S. government’s credit rating.
“If the President is going to ask us to raise the debt ceiling, and he will early next year, we do need to have another serious discussion about trying to do something significant about the deficit and the debt,” Senator McConnell said on CBS’ Face the Nation program.
Both sides showed they had little appetite for compromise last week, when Mr. Boehner insisted at a meeting with President Obama on Wednesday that he would seek spending cuts to offset an increase in the nation’s borrowing limit.
The President warned that he wouldn’t accept more cuts without also extracting tax increases on the wealthiest Americans.
The most obvious showdown will happen soon after the Nov. 6 election.
Unless a lame-duck Congress can strike a deal, the economy will suffer a double whammy of large tax increases and spending cuts starting Jan. 1.
The tax increases would hit virtually every working American, and the spending cuts would affect both military and domestic programs.
On top of that, perhaps by late January or so, Congress and the president — be it Mr. Obama or Republican Mitt Romney — will again confront the need to raise the country’s borrowing limit or else trigger a first-ever government failure to pay its debts.
Mr. Boehner, on ABC’s This Week, said Congress should begin tackling those issues now.