News / USA

Plans to Raise US Debt Ceiling Mired in Congress

House Speaker John Boehner of Ohio speaks with reporters on Capitol Hill in Washington, DC, June 23, 2011
House Speaker John Boehner of Ohio speaks with reporters on Capitol Hill in Washington, DC, June 23, 2011
Michael Bowman

Daunting hurdles remain for two legislative plans to cut U.S. government spending, raise the federal borrowing limit and avert a national debt crisis experts warn that could stall America’s fragile economic recovery and send financial shock waves around the world.  

With a deadline to raise the federal debt ceiling less than a week away, the two latest plans, one Republican, the other Democratic, face almost-certain defeat in one or both chambers of a politically-divided Congress.

Senior Republican lawmakers scrambled Wednesday to rework a plan put forth by House of Representatives Speaker John Boehner after nonpartisan congressional analysts said it would fall short on promised spending cuts.  And some members of the conservative and libertarian Tea Party faction of the Republican caucus vowed to vote against the plan or any proposal that would raise the nation's debt ceiling.

“I pledge to you that I will not vote for any bill that raises the debt ceiling,” said Republican Representative Paul Brown of Georgia.

House Republican leaders are pleading for party unity, without which the Boehner plan might be doomed in the House and leave a Democratic proposal as the only viable alternative.  Both plans call for spending cuts, but the Boehner proposal would raise the debt ceiling in two stages.  The Democratic plan would provide one large-scale increase, preserving federal borrowing authority through next year’s national elections.

In the Senate, one of the Republican Party’s senior statesmen, John McCain of Arizona, chided first-term House Republicans who dismiss the consequences of a possible U.S. debt default.

“The idea seems to be that if the House GOP [Republicans] refuses to raise the debt ceiling, a default crisis or gradual government shutdown will ensue, and the public will turn en masse against [President] Barack Obama, that the Republican House that failed to raise the debt ceiling would somehow escape all the blame.  The reality is that the debt limit will be raised one way or another.  And the only issue now is, with how much fiscal reform and with what political fallout?,” McCain said.

Democrats pounced on Republican dissension over the Boehner plan.

“The speaker’s plan is on life support, and it is time for him to pull the plug. The bill remains a nonstarter in the Senate, and the president will never sign it,” said Democratic Senator Charles Schumer of New York.

Senate Majority Leader Harry Reid, who crafted the Democratic proposal, said his plan abides by Republican demands for no tax increases and deep spending cuts, and is therefore a compromise that deserves bipartisan support.

“We have compromised.  The Senate bill was written to take care of the problems Democrats said they had and Republicans said they had,” Reid said.

The Reid plan leaves untouched expensive entitlement programs that provide income and health care for retirees, programs many Democrats are reluctant to alter.

Republicans say that the Reid plan’s promised spending cuts are an illusion. They note, for example, that it counts projected savings from U.S. military withdrawals in Afghanistan and Iraq, savings that are already included in current budget projections.

“I remain as committed as ever to resolving this crisis in a way that will allow us to avoid default, without raising taxes, and to cut spending, without budget gimmicks,” said Senate Minority Leader, Republican Mitch McConnell.

Even if the federal borrowing limit is extended, it is unclear whether either plan adequately addresses America’s long-term fiscal imbalances.  The U.S. national debt stands at $14.3 trillion.

Analysts say that without aggressive measures to slow the growth of that debt, credit ratings agencies will assign a higher risk rating to U.S. Treasury bonds, which the federal government sells to investors and foreign governments to finance deficit spending.  Such a downgrade, they warn, might lead to higher interest rates that could stall America’s fragile economic recovery.

You May Like

DRC Tries Mega-Farms to Feed Population

Park at Boukanga Lonzo currently has 5,000 hectares under cultivation, crops stretching as far as eye can see, and is start of ambitious large-scale agriculture plan More

Video Survivor Video Testimonies Recount Horrors of Guatemalan Genocide

During a conflict that spanned more than three decades, tens of thousands of indigenous Mayans were killed More

Video War, Drought Threaten Iraq's Marshlands

Areas are spawning ground for Gulf fisheries, a resting place for migrating wildfowl, source of livelihood for fishermen and herders who have called the marshes home for generations More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Nobel Prize Winner Malala Talks to VOAi
X
August 31, 2015 2:17 AM
Nobel Peace Prize winner Malala Yousafzai met with VOA's Deewa service in Washington Sunday to talk about women’s rights and unveil a trailer for her new documentary. VOA's Katherine Gypson has more.
Video

Video Nobel Prize Winner Malala Talks to VOA

Nobel Peace Prize winner Malala Yousafzai met with VOA's Deewa service in Washington Sunday to talk about women’s rights and unveil a trailer for her new documentary. VOA's Katherine Gypson has more.
Video

Video War, Drought Threaten Iraq's Marshlands

Iraq's southern wetlands are in crisis. These areas are the spawning ground for Gulf fisheries, a resting place for migrating wildfowl, and source of livelihood for fishermen and herders. Faith Lapidus has more.
Video

Video Colombians Flee Venezuela as Border Crisis Escalates

Hundreds of Colombians have fled Venezuela since last week, amid an escalating border crisis between the two countries. Last week, Venezuelan President Nicolas Maduro ordered the closure of a key border crossing after smugglers injured three Venezuelan soldiers and a civilian. The president also ordered the deportation of Colombians who are in Venezuela illegally. Zlatica Hoke reports.
Video

Video Rebuilding New Orleans' Music Scene

Ten years after Hurricane Katrina inundated New Orleans, threatening to wash away its vibrant musical heritage along with its neighborhoods, the beat goes on. As Bronwyn Benito and Faith Lapidus report, a Musicians' Village is preserving the city's unique sound.
Video

Video In Russia, Auto Industry in Tailspin

Industry insiders say country relies too heavily on imports as inflation cuts too many consumers out of the market. Daniel Schearf has more from Moscow.
Video

Video Scientist Calls Use of Fetal Tissue in Medical Research Essential

An anti-abortion group responsible for secret recordings of workers at a women's health care organization claims the workers shown are offering baby parts for sale, a charge the organization strongly denies. While the selling of fetal tissue is against the law in the United States, abortion and the use of donated fetal tissue for medical research are both legal. VOA’s Julie Taboh reports.
Video

Video Next to Iran, Climate at Forefront of Obama Agenda

President Barack Obama this week announced new initiatives aimed at making it easier for Americans to access renewable energy sources such as solar and wind. Obama is not slowing down when it comes to pushing through climate change measures, an issue he says is the greatest threat to the country’s national security. VOA correspondent Aru Pande has more from the White House.
Video

Video Arctic Draws International Competition for Oil

A new geopolitical “Great Game” is underway in earth’s northernmost region, the Arctic, where Russia has claimed a large area for resource development and President Barack Obama recently approved Shell Oil Company’s test-drilling project in an area under U.S. control. Greg Flakus reports.
Video

Video Philippine Maritime Police: Chinese Fishermen a Threat to Country’s Security

China and the Philippines both claim maritime rights in the South China Sea.  That includes the right to fish in those waters. Jason Strother reports on how the Philippines is catching Chinese nationals it says are illegal poachers. He has the story from Palawan province.
Video

Video China's Spratly Island Building Said to Light Up the Night 'Like A City'

Southeast Asian countries claim China has illegally seized territory in the Spratly islands. It is especially a concern for a Philippine mayor who says Beijing is occupying parts of his municipality. Jason Strother reports from the capital of Palawan province, Puerto Princesa.
Video

Video Ages-old Ice Reveals Secrets of Climate Change

Ice caps don't just exist at the world's poles. There are also tropical ice caps, and the largest sits atop the Peruvian Andes - but it is melting, quickly, and may be gone within the next 20 years. George Putic reports scientists are now rushing to take samples to get at the valuable information about climate change locked in the ice.

VOA Blogs