Boehner to Obama: No debt hike without concessions

Treasury Secretary Jack Lew warns that Congress is "playing with fire"
Associated Press
Oct 6, 2013

The United States moved closer to the possibility of the first-ever default on the government's debt Sunday as Speaker John Boehner adamantly ruled out a House vote on a straightforward bill to boost the borrowing authority without concessions from President Barack Obama.

With no resolution in sight, Treasury Secretary Jack Lew warned that Congress is "playing with fire" as he called on lawmakers to quickly pass legislation re-opening the government and a measure increasing the nation's $16.7 trillion debt limit.

The government shutdown precipitated by the budget brinkmanship entered its sixth day with hundreds of thousands of federal employees furloughed, national parks closed and an array of government services on hold.

Lew said Obama has not changed his opposition to coupling a bill to re-open the government and raise the borrowing authority with Republican demands for changes in the 3-year-old health care law and spending cuts.

Boehner insisted that Obama must negotiate if the president wants to end the shutdown and avert a default that could trigger a financial crisis and recession that would echo the events of 2008 or worse. The 2008 financial crisis pushed the country into the worst recession since the Great Depression of the 1930s.

"We're not going to pass a clean debt limit increase," the Ohio Republican said in a television interview. "I told the president, there's no way we're going to pass one. The votes are not in the House to pass a clean debt limit, and the president is risking default by not having a conversation with us."

Boehner also said he lacks the votes "to pass a clean CR," or continuing resolution, a reference to the temporary spending bill without conditions that would keep the government operating. Democrats argue that their 200 members in the House plus close to two dozen pragmatic Republicans would back a so-called clean bill if Boehner just allowed a vote, but he remains hamstrung by his tea party-strong GOP caucus.

"Let me issue him a friendly challenge. Put it on the floor Monday or Tuesday. I would bet there are the votes to pass it," said Sen. Chuck Schumer, D-N.Y.

In a series of Sunday television appearances, Lew warned that on Oct. 17, when he exhausts the bookkeeping maneuvers he has been using to keep borrowing, the threat of default would be imminent.

"I'm telling you that on the 17th, we run out of the ability to borrow, and Congress is playing with fire," Lew said.

Lew said that while Treasury expects to have $30 billion of cash on hand on Oct. 17, that money will be quickly exhausted in paying incoming bills given that the government's payments can run up to $60 billion on a single day.

Treasury issued a report on Thursday detailing in stark terms what could happen if the government actually defaulted on its obligations to service the national debt.

"A default would be unprecedented and has the potential to be catastrophic," the Treasury report said. "Credit markets could freeze, the value of the dollar could plummet, U.S. interest rates could skyrocket, the negative spillovers could reverberate around the world."

Private economists generally agree that a default on the U.S. debt would be extremely harmful, especially if the impasse was not resolved quickly.

"If they don't pay on the debt, that would cost us for generations to come," said Mark Zandi, chief economist at Moody's Analytics. He said a debt default would be a "cataclysmic" event that would roil financial markets in the United States and around the world.

Zandi said that holders of U.S. Treasury bonds would demand higher interest rates which would cost the country hundreds of billions of dollars in higher interest payments in coming years on the national debt.

Sen. Ted Cruz, R-Texas, a force in pushing Republicans to link changes to the health care law in exchange for keeping the government running, spelled out his conditions for raising the borrowing authority.

"We should look for three things. No. 1, we should look for some significant structural plan to reduce government spending. No. 2, we should avoid new taxes. And No. 3, we should look for ways to mitigate the harms from 'Obamacare,'" Cruz said, describing the debt ceiling issue as one of the "best leverage the Congress has to rein in the executive."

Some Republicans, such as Rep. Steve King of Iowa, dismiss the warnings about a government default as an exaggeration, suggesting U.S. credit won't collapse and calling the talk "a lot of false demagoguery."

Asked how the standoff might end, Boehner said Sunday on ABC that he was uncertain: "If I knew, I'd tell you."

The Ohio Republican added that Obama can call him any time to start negotiations to end the shutdown. "He knows what my phone number is," Boehner said.

Privately, administration officials say they don't think Boehner and Senate Republican leader Mitch McConnell want a default as they realize it will be far worse than a shutdown, but the two don't know how to avoid it or when to try.

In one promising development, a large chunk of the furloughed federal work force is headed back to the Pentagon on Monday, and those who remain at home or are working without paychecks are a step closer to getting back pay once the partial government shutdown ends.

Defense Secretary Chuck Hagel ended the argument for most Pentagon civilian employees, ordering nearly all 350,000 back on the job. Hagel said he based his decision on a Pentagon interpretation of a law called the Pay Our Military Act.

The Senate will try to vote this week on a bill that passed the House unanimously on Saturday to pay federal workers for days missed.

Boehner and Schumer were interviewed on ABC's "This Week," and Lew and Cruz on CNN's "State of the Union." Lew also appeared on CBS' "Face the Nation," ''Fox News Sunday" and NBC's "Meet the Press."

 

Comments

coasterfan

Actually, the revolution already happened, via 2008 presidential election. The losers just don't like the fact that they lost, and like even LESS that the people (inspite of widespread attempts to disenfranchise millions of Democrat voters) reaffirmed that vote in 2012. And they clearly don't like that they also haven't been able to abolish Obamacare via normal Constitutional channels.

It's a party of losers, whose only ability is that of stopping discussion and saying "no" to everything.

Unfortunately, their version of "revolution" is contrary to the Constitution. The ACA has been affirmed by popular vote (Obama campaigned for re-election with it as part of his platform, and Romney campaigned on a promise to abolish it), along with all three (3) branches of government.

The ACA debate they're demanding has already happened. Congress voted it into law, and a Republican-majority Supreme Court affirmed it. If they don't like the Constitution, there is no fence holding them in. I suggest they move somewhere else, where they can start their own country. The other 80-90% of Americans will not miss Ted or his kind, one bit...

Perkins2060

Did you sign up yet?

Darwin's choice

How about it troll, have you signed your family up yet?

Dr. Information

The US is just like the Roman Empire. While it was once the largest and most powerful empire, its spending, taxation and handouts caused its ultimate collapse. We are no different. This is the beginning of our collapse.

Help your neighbors, help your local community and hope that the government doesn't come to your door for your guns or for more money.

4shizzle

Ohhh , you've got that pretty much wrong , Miss Information.

The Big Dog's back

missinformed, power and greed caused it's collapse. Much like the 1% today.

dorothy gale

The ACA is a law, ruled constitutional by the highest court in the land. Leave it alone, Boner, and do your effing job!

The Big Dog's back

Correct dorothy.

Darwin's choice

Big Dog and Dorothy, either of you two signed up yet?? I'm betting no way....hypocrites both..!

Perkins2060

No, they either got a union exemption or got it paid by the government.

Lil DAB

Obamacare: Tax Or Penalty? The Affordable Care Act is a 'law' of social change. The 'law' costs too much and gives the government too much power in personal health matters.
"In 2014 the initial levy will be just $95. By 2016, it is scheduled to increase to $695 or 2.5 percent of taxable income—up to a maximum of $2,085 (indexed for inflation in subsequent years)."
The IRS can subtract the penalty from any refund it owes a taxpayer. if the tax fails to encourage healthy people to buy until they need coverage, the rest of us will end up paying higher insurance premiums as a result.<-----------
And that’s the trouble with this entire mechanism. You call it a law. The Supreme Court calls it a tax. President Obama and Mitt Romney’s chief spokesman insist it is a penalty. But here’s a better label—inadequate.

http://www.forbes.com/sites/belt...

Truth or Dare

So let me see if I have this straight, a Republican dominated Congress is pretty much saying they're going to default on $$$$'s they themselves already approved if the ACA isn't put on hold, a bill and now law passed by the majority and upheld by a Republican Supreme Court, right? Do I have that straight? Cause I seem to recall past Presidents that weren't willing to deal with TYRRANTS, TERRORISTS either, foreign or domestic!

What a joke on all the hard-working American people this is, and especially those working in "essential" positions on BILLION $$$ GOVERNMENT projects that aren't allowed to use any leave, aren't receiving any pay, and should this continue will be held responsible to pay any bills for necessary travel, lodging & food accrued while working on those government projects, all the while Congress and the rest on Capitol Hill are being paid! Nothing like an entire country being held hostage by those we pay and are meant to represent WE THE PEOPLE!!!! Pretty sure someone will let me know if I'm way off track here.

Perkins2060

Remind me. Didn't Oduma vote against raising the debt ceiling when he was a Senator? Looks like you are another sheep.

coasterfan

Truth: yes, you have the entire scenario correct.

4shizzle

Hi , all you Republican , KoolAid drinking , brain-damaged sheep !!!

coasterfan

Yeah, what is it with Texas? First Bush, then Perry, now Cruz. They seem to champion having a lower than average intelligence. Of course, this is the party that brought us Palin, Bachmann, Cain. If these people are the best your party can find, it's a sign that it's time to find a new party.

OK kids, our country has run effectively for 200+ years on something called MAJORITY RULE. That is, until a minority of like-minded simpletons decided they knew better than the Founding Fathers and all the revered leaders since that time.

Obama is simply handling the debt ceiling issue as has been done in the past. What has changed is that an anarchist minority are holding their breath until they get their way. Obama has no choice but to not give in; if he does, then they have carte blanche to do this every time in the future. That would undermine our entire Majority Rule system as well as our entire electoral process. I applaud Obama, a former Constitutional law professor, for handling the process in a Constitutional way.

Darwin's choice

More from the Obama paid troll...shut up and go away.

Darwin's choice

Obama says to Boehner "Go ahead and put it to a vote right now"...

Hopefully, in true Obama fashion,and copying his tremendous term in the senate,everyone will vote "present"....!

Darwin's choice

"This morning I went to sign my dogs up for welfare. At first the lady said,
"Dogs are not eligible to draw welfare." So I explained to her that my dogs
are mixed in color, unemployed, lazy, can't speak English and have no frigging
clue who their Daddies are. They expect me to feed them, provide them with
housing and medical care. So she looked in her policy book to see what it takes
to qualify. My dogs get their first checks Friday.

Wow, is this is a great country or what?!."

Thank a democrat!.....

The Big Dog's back

durwood, turn off the radio.

Darwin's choice

troll

4shizzle

No , Dummy's choice , YOU are the troll.

bobshumway92

Hussein Odingleberry's favorite way to vote. Present.

big_d

I'm not a politician or a party shill for either party, so the question I ask is: Why is it bad for the working uninsured to be able to purchase health insurance? The people on welfare already have access to medicaid, the senior citizens, medicare. What am I missing? It seems to me that socialized medicine, or some form of it, is coming, it has to. How does a country allow some of its citizens access to healthcare, which is a basic human right, if they are fortunate enough to work for an employer who offers it, or can pay for it out of pocket, and not others?

Darwin's choice

How does a country make it a law that you have to have coverage? If you can't afford to make ends meet for living, how in the hell are you supposed to pay for health insurance? You better read up on ACA.....!

big_d

Isn't that the reason for the ACA? To make it affordable?

bobshumway92

New polls say the majority of Americans do NOT want the debt ceiling raised! Keep up the fight! Oblamer looks more and more childish everyday!

OSUBuckeye59

As one might expect, polls are reflective of those people the news source targets: a new Fox News poll shows a majority of Americans do *NOT* want the debt ceiling raised while a new Huffington Post poll shows a majority of Americans *WANT* the debt ceiling raised.

Darwin's choice

A new poll today says that Americans prefer hemmoriods over Congress 53% to 31%

OSUBuckeye59

Both have something in common, but only 1 pain can be alleviated with a cream medication. :)

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