CQ TODAY ONLINE NEWS
July 19, 2011 – 11:07 p.m.
'Gang of Six' Plan Offers New Momentum in Debt Limit Effort
By Joseph J. Schatz, CQ Staff
A bipartisan Senate budget-cutting proposal gave President Obama and moderates a deficit plan to rally around, but has not answered the question of what to do about raising the debt ceiling.
The plan offered by the “Gang of Six” may have come too late to change the basic dynamics of that debt limit debate, several lawmakers and aides said, as talks on a separate Senate backup measure are quietly continuing.
Plus, the group’s plans for revenue increases as part of a long-term deficit reduction plan seems likely to encounter problems among many House Republicans, who resisted a broad compromise floated by House Speaker
Members of the bipartisan group formed more than six months ago have insisted that their goal is a long-term deficit reduction deal, not a solution to the standoff over raising the $14.3 trillion debt ceiling, which the Treasury Department says must occur by Aug. 2. Yet their apparent progress comes amid grumbling from many lawmakers that none of the other current approaches to raising the debt limit would address the long-term fiscal situation.
By offering broad outlines of a plan to narrow the nation’s deficit by $3.7 trillion over the next decade, the six senators may have provided some of the elements of a final deal, particularly given House Republicans’ insistence on new budgetary restraints in return for raising the debt ceiling.
On Tuesday, House GOP leaders gave the Gang’s plan cautiously positive reviews. A spokesman for Boehner said the plan “shares many similarities with the framework the Speaker discussed with the president, but also appears to fall short in some important areas. The House is voting today on our Cut, Cap and Balance plan, and we hope the Senate will take it up soon. That remains our focus.”
And House Majority Leader
Cantor singled out the plan’s revenue and enforcement mechanisms as possible problems.
Folding Into Reid-McConnell
How the Gang of Six proposal might mesh with a debt limit deal being negotiated by the Senate’s top leaders remains unclear.
Minority Whip
Kyl suggested the group’s plan could be used, though, to direct the work of a new deficit-fighting legislative committee expected to be part of the McConnell-Reid package.
For the past year, the Gang of Six, the president’s debt commission and other groups have produced work that is “all going to inform the select committee, if in fact there is a select committee,” Kyl said.
'Gang of Six' Plan Offers New Momentum in Debt Limit Effort
Reid said he may choose to incorporate elements of the Gang’s plan into the measure he is working on with McConnell. He said he directed Virginia Democrat
Some members suggested advancing a short-term increase in the debt limit — an approach Obama has opposed — to buy time for Congress to act on the Gang’s plan.
But Reid and McConnell maintained some distance.
“I don’t want to do anything to jeopardize the enthusiasm people have for the Gang of Six, but I am the person that runs the Senate, and I understand what the rules of the Senate are,” Reid said, noting that it could take the Congressional Budget Office weeks to provide a budgetary analysis of the plan.
McConnell praised GOP senators involved in the talks but said he was still reviewing the proposal.
Plan Details
The six senators’ decision to update fellow members on their progress Tuesday came just two weeks before a potential government default and amid considerate complaint — from moderates in both parties — that the current debt limit deals being considered by Congress and the White House would not address the long-term debt.
The Gang — which welcomed
Senate Budget Chairman
Senators of both parties embraced the plan, though it drew criticism from the hard right of the GOP, including
President Obama praised the Gang of Six plan, calling it “broadly consistent with the approach I have urged.”
Debt Limit Endgame
Congressional leaders’ overall strategy for engineering a bipartisan debt limit endgame remained under discussion Tuesday, however, as Republicans pushed a budget plan (
'Gang of Six' Plan Offers New Momentum in Debt Limit Effort
The bill would make an increase in the debt limit contingent upon the passage of a balanced-budget constitutional amendment. It also would set fiscal 2012 discretionary spending at $1.019 trillion, the level set in the House’s budget resolution for the year (
The McConnell plan would effectively allow the president to request $2.5 trillion in additional borrowing authority in three installments over the next year and a half. As currently envisioned, it would trigger an automatic $100 billion increase in the debt ceiling, buying time for Obama to request the first installment of the debt ceiling authority.
That would also give Congress time to act on a resolution of disapproval, and a potential veto override vote, if lawmakers are unable to take those steps before Aug. 2 — the date on which the government would start defaulting if the debt ceiling is not raised, according to the Treasury Department.
House and Senate leaders are being exceedingly careful not to portray the McConnell Reid plan as a done deal amid conservative distaste with it — and uncertainty over what can garner 218 votes in the House.
House Minority Whip
With many House Republicans opposed to the emerging Senate plan — and some conservatives unlikely to vote for any debt limit increase — House Democratic votes are likely to become increasingly important in the coming week.
Hoyer said he hopes Republican leaders can deliver a majority of their caucus for any eventual deal, pointing to a debt ceiling vote in the 1980s when President Ronald Reagan won the support of a majority of Republicans and Democrats, after warning of the consequences of a government default.
McConnell is pushing for Senate votes on the “cut, cap and balance” plan, and on a proposal for a balanced-budget amendment to the Constitution.
Although both are expected to fail, Republicans are likely to demand votes on those measures before the chamber moves to McConnell’s backup plan, which appears unlikely to occur before this weekend. Leadership aides said a vote on the House-passed budget bill probably would be taken this weekend.
Paul M. Krawzak, Alan K. Ota and Frances Symes contributed to this story.