Boehner preps for another debt-ceiling standoff
WASHINGTON -- Ready for another debt-ceiling standoff in Congress?
House Speaker John A. Boehner said Tuesday he will insist on spending cuts in exchange for a vote in Congress to raise the nation’s debt limit, forewarning a year-end showdown that could resemble the standoff that resulted in a gridlocked Congress and the nation’s first ever credit rating downgrade.
“We shouldn’t dread the debt limit. We should welcome it. It’s an action-forcing event in a town that has become infamous for inaction,” Boehner is expected to say Tuesday afternoon in remarks released by his office ahead of his talk at the Peter G. Peterson Foundation’s 2012 Fiscal Summit in Washington.
“When the time comes, I will again insist on my simple principle of cuts and reforms greater than the debt limit increase,” Boehner continued. “This is the only avenue I see right now to force the elected leadership of this country to solve our structural fiscal imbalance. If that means we have to do a series of stop-gap measures, so be it – but that’s not the ideal.”
Boehner’s comments were the first to directly establish what many in Washington have expected: Republicans will once again use the need to raise the nation’s debt ceiling to force President Obama and Democrats to make deep budget cuts.
The Obama administration is expected to ask Congress to increase the debt limit later this year, when the Treasury will exhaust its borrowing authority. Failure to do so would risk defaulting on the nation’s already accrued obligations.
Treasury Secretary Timothy Geithner, speaking at the same event Tuesday, warned against another political showdown over the debt ceiling, which he said would likely need to be raised by Congress in “the early part of 2013.”
“You can’t put that into question; you can’t put it into doubt,” Geithner said. “And you know, we hope they do it this time without the drama and the pain and the damage they caused the country last July.”
The debt limit vote could bump up against a post-election lame-duck session – what some in Washington are calling lame-duck-a-geddon – when Congress will be faced with a legislative pileup of mandatory deep spending cuts and expiring tax breaks for wealthier Americans and others.
Last summer, Congress came to a standstill as Boehner and Obama tried, unsuccessfully, to strike a “grand bargain” that would reduce spending and revamp the tax code in exchange for the vote to raise the debt limit. Congress ultimately agreed to allow more borrowing, but the standoff led to a credit rating drop.
Democrats reacted strongly to the speaker’s gameplan. “The last thing the country needs is a rerun of last summer’s debacle that nearly brought down our economy,” said Sen. Charles Schumer (D-N.Y.)
Boehner faces a difficult political task as he tries to corral his conservative House majority for another debt ceiling fight. Last year’s battle was damaging for all sides, and left Congress with its lowest-ever approval ratings.
By beginning to address the issue, the speaker is preparing his troops for the difficult compromise ahead. One tack would be to tie the debt ceiling hike to an extension of the George W. Bush-era tax rates, which expire Dec. 31.
Republicans argued that raising taxes now would harm the economy, but Democrats want to allow the lower tax rates for wealthier Americans to expire – adding $800 billion in new revenue to improve the fiscal outlook.
Boehner suggested the House will consider legislation in the weeks ahead to extend all tax breaks for one year as Congress considers a broader tax overhaul in 2013.
Original source: Boehner preps for another debt-ceiling standoff