US’s Boehner: ‘Lot Of Options Available To Us’ on Debt Ceiling

Author: Market News International | Category: News

–House Speaker: House To Vote On ‘Balanced’ Plan Later Tuesday
–‘In the Current Environment, Anything is Possible’
–Obama’s ‘Actions Haven’t Matched His Rhetoric’

By John Shaw

WASHINGTON (MNI) – House Speaker John Boehner said Tuesday the
congressional effort to increase the statutory debt ceiling and cut
budget deficits continues to evolve, adding he is unsure how events will
play out.

“There are a lot of options available to us,” Boehner said at a
briefing to promote a bill the House will vote on later in the day.

That bill, which was written by conservative House Republicans,
would cap annual federal spending at 19.9% of gross domestic product by
2021, limit discretionary spending for fiscal year 2012 at $1.019
trillion, and allow for a $2.4 trillion increase in the debt ceiling
after the House and Senate pass a balanced budget constitutional
amendment.

Boehner said this approach is “balanced” and should be supported by
President Obama. The White House has already released a statement saying
Obama would veto the bill if it reached his desk.

Senate Democratic leaders said they do not expect it to pass the
Senate. The House is expected to approve the bill Tuesday on a party
line vote.

Boehner repeated that Congress should both increase the debt limit
and pass sweeping deficit cutting measures.

But he added that the current environment on Capitol Hill is very
complex and fluid.

“In the current environment, anything is possible,” Boehner said.

The Speaker said a “balanced” agreement involves Congress
increasing the debt ceiling in exchange for substantial spending
savings.

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

The Senate may take up and vote on a balanced budget amendment this
week, as early as Wednesday.

The House and Senate votes are expected to serve as ways to allow
conservative Republicans to vote for “tough” fiscal policies.

Even as these votes are being cast, Obama is expected to continue
to explore a deficit reduction and debt ceiling package with
congressional leaders.

The current focus of the talks appears to be on a revised version
of a plan Senate Minority Leader Mitch McConnell unveiled last week.

McConnell outlined a plan that would allow the debt ceiling to be
increased in three tranches of $700 billion, $900 billion and $900
billion over the next year.

To get these increases in the debt ceiling, the president would
have to introduce spending cut packages of the same size — and
Democrats would have to defeat Republican motions to disapprove of the
debt hike.

McConnell’s plan has sparked more interest from the White House and
congressional Democrats than Republicans, but Boehner has not ruled out
taking up some version of the McConnell plan.

McConnell is working with Senate Majority Leader Harry Reid on
revisions to his package. Those might include attaching up to $1.5
trillion in spending cuts to the plan as well as creating a new
congressional panel that would be charged with submitting a deficit
reduction plan later in the year that would be voted on by the House and
Senate.

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

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