–Senate Minority Leader: ‘Perplexed’ By Admin Support For Tax Increase
–Sen. Kyl: Tsy To Announce ‘Relatively Soon’ Aug 2 Debt Hike Extend
–Senate Majority Leader Reid: ‘Not Aware’ of Future Debt Talks
–Sen. Reid: Key Programs ‘At Risk’ In Debt Hike Stalemate

By John Shaw

WASHINGTON (MNI) – Senate Minority Leader Mitch McConnell said
Tuesday he had a “good discussion” with President Obama Monday evening
on budget issues, but added that “the path forward seems to be blocked
by the insistence” of the White House that additional revenues need to
be part of the final deficit reduction package.

In remarks to reporters, McConnell continued to take a hard line on
debt ceiling legislation, saying that Republicans oppose additional
revenues as part of any deficit reduction plan. He said he is
“perplexed” that Democrats want to include tax increases into any
deficit reduction package.

McConnell said he continues to see the need for a debt ceiling
increase to be an “opportunity to do something important about the
debt.”

“The larger the package, the better,” he said, referring to the
size of a deficit reduction plan that Republicans say must accompany a
debt ceiling increase.

McConnell said that budget discussions between Congress and the
White House will occur.

“The talk continues,” McConnell said.

Senate Minority Whip Jon Kyl said tax increases would be “very
harmful” to the fragile American economy. “It is the wrong thing for the
country,” Kyl said of tax increases.

On a related matter, Kyl said he expects Treasury to announce
“relatively soon” an extension of the debt ceiling deadline that goes
beyond August 2.

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.

Speaking after the Senate Republican leaders, Senate Majority
Leader Harry Reid hammered the GOP for even discussing blocking a debt
ceiling increase.

“My Republican friends seem to be living in a fantasy land,” he
said.

Reid said failure to pass a debt ceiling hike would put “at risk”
payment for Social Security benefits, veterans programs, military
salaries and other federal expenditures.

Reid said is not “aware of any” additional meetings that are
scheduled between President Obama and congressional leaders on budget
matters.

Asked to assess the state of the negotiations, Reid quipped that
his talks with Obama are going “great.”

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

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