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Even as it exposes fault lines in the new Republican caucus, a looming clash over the federal government’s borrowing power could serve as a major bargaining chip for Republicans hoping to force President Barack Obama to green light major spending cuts.
Some conservative Republicans have urged their GOP colleagues to resist raising the ceiling -- which currently clocks in at $14.3 trillion -- under any circumstances. Rep. Michele Bachmann of Minnesota is collecting signatures on her PAC's website "to force our elected officials to stop spending cold turkey," and Sen. Jim DeMint of South Carolina has advocated for a "big showdown" with Democrats by blocking the raise.
But House Budget Chairman Rep. Paul Ryan says that tactic isn't viable. "Just refusing to vote for it, I don't think that's really a strategy," he said, noting that a failure to raise the ceiling could result in the nation defaulting on its debts to investors.
"Will the debt ceiling be raised? Does it have to be raised? Yes," he said at an event sponsored by economics21 and the Manhattan Institute at the National Press Club Thursday.
But Ryan suggested that Republicans can tweak some specifics of the move - how many years the increase covers, for example. And, more importantly, they can tack on requirements for deep spending cuts as a condition of passage. "I want to make sure we get substantial spending cuts and controls in exchange for raising the debt ceiling," he said.
In a letter to Congress Thursday, Treasury Secretary Tim Geithner called on lawmakers to act swiftly to raise the debt limit, calling a default "unthinkable" and warning that it could cost "millions of American jobs."
Congress may be able to hammer out a deal on a debt ceiling increase, but Republicans have made clear that compromise with Democrats is still likely to be the exception, not the rule, in the 112th Congress.
House Republicans say they are determined to vote on repealing Obama’s health care reform law, despite CBO estimates that say the bill would actually reduce the deficit by $145 billion by the end of this decade.
Ryan said that Democrats omitted several high-cost aspects of the bill when submitting it to the CBO for scoring, like the cost of implementation and the "doc fix" provision that sustains high levels of Medicare payments.
"It's not CBO that did the book cooking, it's Democrats that wrote the bill that they gave to CBO that cooked the books," Ryan said.
House Majority Leader Eric Cantor today called the CBO figure "full of budget gimmickry" and defended the merits of holding a vote to repeal the bill, saying it showed that Democratic-controlled Senate “wants to continue to be the impediment for results."
In addition to a continued battle over the health care law, Ryan said that the Budget Committee would hold "lots of hearings" over federal assistance to fiscally troubled states, adding that a bailout would not be on the table.
"Should taxpayers in frugal states have to bail out taxpayers in profligate states?" Ryan asked, using Indiana and California as his respective examples, potentially foreshadowing a coastal-versus-heartland battle to come.
And the hearings on fiscal issues won't stop there, Ryan added.
Referring to the Fed foe set to become chairman of the House subcommittee on monetary policy, Ryan quipped: "I'm sure Ron Paul has a few plans of his own."
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As for the Health Care Reform Act, some like it, some don't. As far as I can tell, no one is so smart that they really know what the impact will be. Why not give it a chance and see what happens? It beats the status quo of doing nothing. I don't think anyone with a brain would say they don't want to be protected fromnot getting coverage with a pre-existing condition or being dropped if they get sick or hit a coverage ceiling or don't want 50% off drugs for Medicare people if they hit the donut hole, etc. The only arguement is the cost. Cost to individuals and the economy.
Again, NOBODY can guaranty they are right about costs. Lets see. Lets look at how the act unfolds. Sure, we may need to tweek it here and there. We may need to have major changes or even scrap it in favor of a better way. The current system is not that better way.
My only concern is that Congress is not at all flexable and able to quickly adjust when adjusting is required. It's always a knock down fight. I suspect that if Russia invaded the US, Democats and Republicans would blame each other, submit bills, table bills and filibuster until they get their pork projects and make the other party look as bad as possible. In the mean time, we will have all learned Russian.
Jody I will bet your thinking 98% make under $250,000 is off base. There are many making that counting payroll and investments. Beside that if only 2% are paying the higher taxes why would you be upset? They should not have to take most of the brunt of the tax code but ther are.
Let's see... Republicans said nothing when we hit 8 trillion in debt under Bush by 2006 and sat quietly when he issued a stimulus package in 2008 and the 1st bail out prior to his exit to buy more time so he and Cheney could walk out the back door with the blood money (Haliburton) they looted from the American people. No failed economy to stop from bleeding to death; no reason we went to Iraq (which costs us billions per month) and no exit strategy; no clue and the dubious distinction of being the worst POTUS in history! Seems like stimulus and bailouts are OK as long as the Rethuglicans are the ones issuing them! Unbelievable... Guess I shouldn't count out Donald Duck Trump for President in 2012 either!
Some terrific comments today by many on this topic, but I have to say I am in total agreement with John Carter 42879 #10-3 that only tax increases cost the taxpayers money.
If you can take two hours of your time to watch a video that is relevant to everything about the federal government, sit back and watch this and learn the truth about how all presidents and the congress are powerless to change anything...
http://www.youtube.com/watch?v=eAaQNACwaLw It will open your eyes to the truth no matter what party you are affiliated with.
Here's another 2 hour lesson in modern history that is absolute fact; if this doesn't frighten anyone, somethings wrong.
http://www.youtube.com/watch?v=Klqv9t1zVww&feature=related
Johnny-Q's got it right: Republicans only started screaming about deficits and debt when Barack Obama was elected.
Not ONE WORD about jobs. NONE! All a dog and pony political show. This is the most corrupt Congress ever.
And looking at several of your posts, I wouldn't want to work for you anyway. You probably pay crappy wages with absolutely no benefits. Been there and done that - no more.......
Wounldn't trust any Republican,being led by Cantor.This guy got his own agenda and not in America favor. Trying to make Red state and blue state as seprate countrys. Only a fool would think democrats got us to 14.5 trillion defcit. Repblicans got us in this DEPRESSION like in 1929,but this time they left a HOLE in New York because of security lapses.why'll plundering the foreign greedy buyers of toxic mortgages. They got what they deserve,thinking it was a no brainer. So quit the B S America needs to be Taxs,till it hurts the greedy wall street corporation Barrons.American soldeirs die thinking they are defending America,but in fact defend Corporation who don't pay AMERICAN TAXS.Republican Defend this view,so doe Cantor.