GOP leader suggests giving Obama new power to increase debt limit

Associated Press

WASHINGTON

With compromise talks at a virtual standstill, Senate Republicans unexpectedly offered Tuesday to hand President Barack Obama new powers to avert the first government default threatened for Aug. 2.

Under a proposal outlined by Sen. Mitch McConnell of Kentucky, Obama could request — and likely secure — increases of up to $2.5 trillion in the government’s borrowing authority in three separate installments over the next year, as long as he simultaneously proposed spending cuts of greater size.

The debt-limit increases would take effect unless blocked by Congress under special rules that would require speedy action — and even then Obama could exercise his authority to veto such legislation. Significantly, the president’s spending cuts would be debated under normal procedures, with no guarantee they ever come to a final vote.

McConnell made his proposal public a few hours before Obama presided over his third meeting in three days with congressional leaders searching for a way to avoid a default and possible financial crisis.

Democratic officials who participated in the session said Obama did not reject the Senate Republican leader’s suggestion but stressed it was not his preferred approach. A statement issued later in press secretary Jay Carney’s name said the president “continues to believe that our focus must remain on seizing this unique opportunity to come to agreement on significant, balanced deficit reduction.”

Other officials said participants at the meeting spent part of the time reviewing proposed spending cuts that were made by both sides during several weeks of negotiations led by Vice President Joe Biden, suggesting that negotiators had not given up on a deal to cut deficits.

There was little or no dispute among senior officials about the importance of avoiding default.

In an interview on CBS taped before the meeting, Obama said that without a deal to raise the debt limit, he could not guarantee that Social Security checks will be issued Aug. 3 “because there may simply not be the money in the coffers to do it.”

House Speaker John Boehner, R-Ohio, interviewed on Fox News, pointed to turmoil rippling across Europe as evidence of what might happen if the United States defaults on its obligations.

In essence, McConnell’s proposal would greatly enhance Obama’s authority to avoid a default, while also virtually absolving Republicans of responsibility if one occurred.

At the same time, it would allow Republican lawmakers to avoid having to support an increase in the debt limit, something many of them find odious.

“Republicans will choose a path that actually reflects the will of the people, which is to do the responsible thing and ensure the government doesn’t default on its obligations,” McConnell said in a speech on the Senate floor. He also excoriated the administration for seeking tax increases along with spending cuts as part of an agreement to raise the debt limit, adding that as long as Obama is president, “a real solution is unattainable.”

Boehner praised McConnell for doing “good work” with his recommendation but did not endorse it.

Other conservatives were less polite. Presidential hopeful Newt Gingrich tweeted his criticism almost as soon as the proposal was released. Rep. Louie Gohmert, R-Texas, said Republicans would be “agreeing to give up the best leverage that we could possibly have to get the country on track financially in return for an agreement that is completely unenforceable.”