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Saturday, July 23, 2011

McConnell: Congress committed to prevent default

McConnell: Congress committed to prevent default

AP Photo
President Barack Obama meets with House Speaker John Boehner of Ohio, left, in the Cabinet Room of the White House, Saturday, July 23, 2011, in Washington, to discuss the debt.

WASHINGTON (AP) -- President Barack Obama met for less than an hour Saturday with congressional leaders in crisis talks, and a leading Republican said afterward that top lawmakers were "committed to working on new legislation" to cut federal spending and avert an unprecedented U.S. default.

"The president wanted to know that there was a plan for preventing national default," Senate GOP leader Mitch McConnell said in a statement issued shortly after the brief meeting at the White House.

"The bipartisan leadership in Congress is committed to working on new legislation that will prevent default while substantially reducing Washington spending," McConnell said.

Neither Obama nor any of the lawmakers with whom he met spoke to reporters after the meeting.

The president was flanked at the bargaining table by Republican House Speaker John Boehner of Ohio and Democratic Senate Majority Leader Harry Reid of Nevada. Also at the table were Vice President Joe Biden, House Minority Leader Nancy Pelosi, D-Calif., and McConnell, R-Ky.

Friday night, a visibly irritated Obama had summoned congressional leaders from both parties to find a way to raise the debt limit before an Aug. 2 deadline cuts off the government's borrowing authority. Boehner announced Friday he was abandoning the talks he had had for weeks with Obama, but he agreed to attend with the others on Saturday.

The president devoted his weekly radio and Internet address Saturday to the impasse and urged Republicans to make a deal.

"We can come together for the good of the country and reach a compromise. We can strengthen our economy and leave for our children a more secure future," the president said. "Or we can issue insults and demands and ultimatums at each another, withdraw to our partisan corners and achieve nothing."

Rep. Jeb Hensarling of Texas said in his party's weekly address that the Democrats were to blame.

"If we're going to avoid any type of default and downgrade - if we're going to resume job creation in America - the president and his allies need to listen to the people and work with Republicans to cut up the credit cards once and for all," he said.

Boehner and McConnell also criticized Obama and the Democrats before the latest talks began.

"If the White House won't get serious, we will," Boehner's office said. A statement from the office noted that Obama has said he wants an agreement that will take care of the problem through the November 2012 elections.

"It would be terribly unfortunate if the president was willing to veto a debt limit increase simply because its timing would not be ideal for his re-election campaign," according to Boehner's office.

McConnell said in a statement that it was "disappointing that the talks with the White House did not reach a favorable conclusion, and I appreciate the speaker insisting on reduced spending and opposing the president's call for higher taxes on American families and job creators."

At a news conference Friday after Boehner said he was withdrawing, Obama told reporters, "We have run out of time and they are going to have to explain to me how it is that we are going to avoid default.

Boehner accepted the invitation for Saturday's meeting even while arguing that Obama bore the blame for the collapse.

The political theater played out even as the deadline neared. Barring action by then, the Treasury will be unable to pay its bills. That could cause interest rates to rise, threaten the U.S. economic recovery and send shock waves around the globe.

The deadline pressure hasn't seemed to bring the parties closer, even though they all insist they do not want a default.

For the first time since talks began, Obama declined to offer assurances that a default would be avoided, although moments later he said he was confident of that outcome.

Obama said Boehner left a deal on the table that was better for Republicans than for Democrats, with $2.6 trillion in cuts outweighing new tax revenue of $1.2 trillion. The president said he was losing confidence that the underlying deficit problems would be dealt with even if the borrowing limit rose.

"I've been left at the altar now a couple of times," Obama said.

Still, aides on both sides said there was agreement on gradually raising the age of eligibility of Medicare from 65 to 67 for future beneficiaries, and slowing the increase in cost-of-living raises in Social Security checks.

Even by the recent standards of divided government, Boehner's decision triggered an extraordinary evening Friday as the Democratic president and then the Republican speaker maneuvered for political position on this vital issue.

Unspoken, yet unmistakable in all the brinkmanship was the 2012 election campaign, still 18 months away, with the White House and both houses of Congress at stake.

Private, sometimes-secret negotiations had veered uncertainly for weeks, generating reports as late as Thursday that the two sides were possibly closing in on an agreement to slash spending. That triggered a revolt among Democrats who expressed fears the president was giving away too much in terms of cuts to Medicare and Social Security while getting too little by way of additional revenues.

Obama said his only requirement for an agreement was legislation that provides the Treasury enough borrowing authority to tide the government over through the 2012 election. Boehner said he had little interest in a short-term extension either.

Republican aides said Obama had upped his demand for higher taxes during the week. The aides said administration officials had tacitly agreed to $800 billion in new revenue over 10 years but that the White House backed away and wanted $400 billion more.

Aides said the two sides were not able to bridge their differences over the triggers designed to force Congress to enact both tax changes and cuts to Medicare and other benefit programs by early next year. Both sides also were apart on the size of cuts for Medicaid, the health care program for the poor and disabled.

Yet aides on both sides said the negotiations had yielded agreement for cuts of $250 billion from Medicare.

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