US Senate Kills Boehner Debt Hike Plan;Reid Wants Talks W/GOP

Author: Market News International | Category: News

–Senate Votes To Reject Boehner’s Debt Plan, 59 to 41
–Senate GOP, In Dig To Reid, Threatens Filibuster of His Plan
–Senate Leaders Reid, McConnell Exchange Verbal Shots
–Sen. Reid: McConnell Rejected Two Offers Friday To Begin Talks

By John Shaw

WASHINGTON (MNI) – Just moments after House Speaker John Boehner’s
carefully crafted debt limit bill arrived on the Senate floor Friday
evening, Senate Democrats voted to defeat the bill.

The Senate voted to reject Boehner’s debt hike plan on a 59 to 41
vote. All Democrats voted to kill Boehner’s bill. Several conservative
Senate Republicans also voted against Boehner’s bill, presumably because
it would increase the debt ceiling.

The House approved the GOP’s debt hike bill Friday evening on a 218
to 210 vote. No Democrat voted for the legislation. All but 20 House
Republicans voted for it.

After the Senate voted to kill the Boehner plan, Senate Majority
Leader Harry Reid then moved to cut off debate on his own debt hike
package. The Senate will vote Saturday night around midnight on this
motion.

Senate Minority Leader Mitch McConnell, in a clear effort to
symbolically protect Boehner, taunted Reid to hold the Senate vote on
the Democratic leader’s plan immediately.

Reid, knowing that he does not yet have 60 votes to prevail on this
motion, declined McConnell’s offer.

McConnell noted that House Republicans have set up a weekend vote
on Reid’s debt limit plan where it is certain to be defeated on a near
party line vote.

The House’s vote on the Reid plan is a symbolic retaliation for the
Senate’s rejection of Boehner’s plan.

McConnell noted that the House will vote on the Reid debt hike plan
Saturday afternoon.

Speaking on the Senate floor, Reid said he urged McConnell and
other Republicans to begin talks on a compromise bill, but Republican
senators have so far declined.

Reid blasted Republicans for not entering immediate bipartisan
talks on a compromise as the debt ceiling deadline on August 2 draws
near.

Reid and McConnell exchanged several tight-lipped barbs over
procedural matters on the Senate floor Friday night, perhaps signalling
that the talks between Reid and McConnell will be difficult.

Boehner’s bill would raise the debt ceiling by $900 billion this
year and $1.6 trillion next year. The initial $900 billion debt ceiling
increase would require Congress to pass $917 billion in spending cuts
through the imposition of caps on discretionary spending.

Approval of the second tranche of $1.6 trillion would require
passage of $1.8 trillion in spending cuts in entitlement programs and
passage by the House and Senate of the balanced budget amendment which
requires two-thirds majorities in both chambers.

Reid’s own plan would cut spending by $2.4 trillion over ten years
and allow for passage of a $2.4 trillion debt ceiling increase.

It is assumed the final debt hike package is likely to blend
aspects of the Boehner and Reid plans, but it may be several days before
that emerges.

Speaking at a Friday night briefing after he skirmished with
McConnell, Reid, Senate Majority Whip Dick Durbin, and Sen. Chuck
Schumer, all said Democrats want to enter into talks with McConnell and
other Republican senators on a final debt deal–but McConnell is
resisting.

“We are waiting for them to do something, anything,” Reid said.

Reid said he approached McConnell twice Friday to begin talks on
a final debt hike plan and he declined.

Schumer said that 10 Republican senators indicated to him that they
want to enter talks with Democrats, but he added they are waiting for “a
permission slip” from McConnell to begin these discussions.

“The Senate is the only way out of this mess,” Schumer said.

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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