Photo: AP Photo/Harry Hamburg
Congressional efforts to remove President Barack Obama from negotiations to raise the debt limit and lower the debt ceiling failed Saturday, after Democratic lawmakers rejected a GOP offer to raise the debt ceiling in two stages.In a tersely worded statement, Senate Majority Leader Harry Reid (D-NV) said he is “deeply disappointed” with the status of negotiations, warning of dire consequences if Republicans would not agree to raise the debt limit through the end of next year.
“I have said repeatedly, including last night and again today, that I will not support any agreement that fails to raise the debt ceiling though the end of 2012,” he said. “Anything less than that will fail to provide the certainty that the markets — and the world — are looking for, risking an immediate downgrade of America’s credit rating. This would force a tax increase on all Americans, and drain their savings funds and retirement plans as well.”
At a meeting in the Capitol, Speaker of the House John Boehner (R-OH) and Senate Minority Leader Mitch McConnell (R-KY) presented Reid and House Minority Leader Nancy Pelosi (D-CA) with a deficit reduction package that would include immediate cuts in spending, while creating a bipartisan fiscal commission to push deeper cuts later this year.
The Republican leaders’ proposal would have raised the debt limit in two stages — the latter increase only coming once the fiscal commission’s cuts were implemented — forcing a second vote before the 2012 election.
Boehner spokesman Michael Steel said that “for months, we have laid out our principles to pass a bill that fulfils the President’s request to increase the debt limit beyond the next election.”
“We have passed a debt limit increase with the reforms the American people demand, the ‘Cut, Cap, and Balance’ bill. The Democrats who run Washington have refused to offer a plan,” he added. “Now, as a result, a two-step process is inevitable.”
White House Press Secretary Jay Carney said in a statement earlier Saturday that it won’t get any easier for Congressional leaders to raise the debt ceiling later this year.
“As the current situation makes clear, it would be irresponsible to put our country and economy at risk again in just a few short months with another battle over raising the debt ceiling,” he said. “Congress should refrain from playing reckless political games with our economy.”
Obama has said he will veto any plan that requires multiple votes to raise the debt limit — largely considered by many Republicans to be an empty threat.
Reid said the decision on whether a deal is reached before the Asian financial markets open rests in Republican hands.
“I hope that Speaker Boehner and Leader McConnell will reconsider their intransigence,” he said. “Their unwillingness to compromise is pushing us to the brink of a default on the full faith and credit of the United States. We have run out of time for politics. Now is the time for cooperation.”
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