–Vice President: ‘Next Phase’ of Talks Shifts To Obama, Hill Leaders
–Made ‘Significant Progress’ on Plan With ‘Substantial Savings’
–Plan Should Include Spending Savings, Close Tax Loopholes

By John Shaw

WASHINGTON (MNI) – Vice President Joe Biden said Thursday evening
that the budget talks he led for six weeks made “significant progress”
toward a budget agreement that secures “substantial savings,” but he
added that these talks are now “in abeyance.”

In a statement, Biden made no direct mention of the decision by
House Majority Leader Eric Cantor or Senate Minority Whip Jon Kyl
Thursday to leave the negotiations that Biden has been presiding over
since early May.

Biden said the goal of the talks was to create a broad fiscal
framework that could be presented to “our respective leaders” to
consider and conclude.

“The next phase is in the hands of those leaders,” he said, in a
reference to President Obama, House Speaker John Boehner and Senate
Majority Leader Harry Reid.

“We have made real headway and laid the groundwork to get this
done,” Biden said.

The vice president said a final agreement should take a “balanced
approach that finds real savings across the budget–including domestic
spending, defense spending, mandatory spending and loopholes in the tax
code.”

In his statement Thursday morning announcing his decision to leave
the Biden talks, Cantor said there was an impasse on taxes.

“This tax issue must be resolved before discussions can continue,”
Cantor said. He called on Obama to “speak clearly and resolve the tax
issue.”

Democrats in the budget talks have said that additional revenues
should be part of the discussion. Republicans, led by Cantor and Kyl,
have said tax increases should not be considered.

Cantor has said the focus of the talks should be on assembling
“trillions” in spending cuts.

Biden’s statement includes none of the blistering criticism of
Cantor and Kyl that Senate Democratic leaders unleashed on the GOP
lawmakers Thursday afternoon.

“It appears they are giving up,” Reid said, calling the departure
of Cantor and Kyl from the talks “untoward and terribly disappointing.”

He accused Cantor, Kyl and other Republicans of “walking away from
our country’s problems.”

Biden has been negotiating with Cantor, Kyl, Senate Appropriations
Committee Chairman Dan Inouye, Senate Finance Committee Chairman Max
Baucus, Assistant House Minority Leader Jim Clyburn and Rep. Chris Van
Hollen, the top Democrat on the House Budget Committee.

The administration has been represented by Biden, Treasury
Secretary Tim Geithner, White House budget director Jack Lew and the
director of the National Economic Council Gene Sperling.

The Biden talks have been seeking a deficit reduction package that
could be developed to coincide with this summer’s vote on debt ceiling
legislation.

The U.S. has already reached its $14.29 trillion debt ceiling.
Treasury Secretary Tim Geithner has said that Congress must pass
legislation increasing the debt ceiling by August 2.

** Market News International Washington Bureau: (202) 371-2121 **

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