WASHINGTON – House Speaker John Boehner hastily rewrote his stalled debt-limit bill again Friday, and former conservative foes began climbing aboard. Senate Democratic leader Harry Reid signalled he’s ready to push ahead with his own version, and President Barack Obama declared “we’re almost out of time” in a wrenching political standoff that has heightened fears of a market-rattling government default.
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“The power to solve this is in our hands on a day when we’ve been reminded how fragile the economy already is,” the president said from the White House as many U.S. stocks fell in response to a sour report on economic growth and widespread uncertainty over the Washington debt stalemate. “This is one burden we can lift ourselves. We can end it with a simple vote.”
A simple vote was hard to come by, just a few days before Tuesday’s debt-limit deadline.
On Capitol Hill, Boehner revised his measure and made inroads with reluctant rank-and-file conservatives who have argued that the deficit cuts it contained were insufficient in exchange for a debt limit hike. The leadership pushed toward a late Friday vote.
Rep. David Dreier of California said the revised measure would still raise the nation’s debt limit by $900 billion – essential to allow the government to keep paying its bills – and cut spending by $917 billion. But a later increase in borrowing authority wouldn’t take effect unless Congress sent a constitutional balanced budget amendment to the states for ratification.
That was a key demand of rebellious conservatives who withheld their votes from the legislation on Thursday night.
That balanced-budget amendment addition made Phil Gingery, R-Ga., a convert. “That’s basically what many of us were holding out for,” he said after GOP leaders made a fresh appeal to rank and file at a closed-door meeting.
Freshman Rep. Mo Brooks, R-Ala., said the change on the balanced-budget amendment “got a lot of additional Republican votes.”
Even Rep. Louie Gohmert, R-Texas, a self-described “beat-up no” after days of arm-twisting, said he was leaning toward “yes.”
The White House immediately dismissed the new version, with spokesman Jay Carney calling it “moot and irrelevant” and certain to fail in the Senate.
In a nod to the endgame, however, Carney added: “We do have to wait for that process to play out before we can get focused on legitimately solving this problem.”
In the Senate, Reid pressed forward with his legislation, setting up a showdown vote for Sunday. On the Senate floor, Reid said glumly, “This is likely our last chance to save this nation from default.”
The Nevada Democrat said he had invited Senate Minority Leader Mitch McConnell, R-Ky., to join him in negotiations.
A divided government is struggling to break the extreme Washington gridlock and head off a first-ever default that would leave the Treasury without the money necessary to pay all its bills. Administration officials say Tuesday is the deadline.
“There are plenty of ways out of this mess. But we are almost out of time,” Obama said.
The biggest sticking point is the House bill’s call for congressional votes to raise the debt ceiling, in two stages, before the 2012 elections. The president wants one vote before his bid for a second term. No matter how the endgame plays out, one House GOP veteran indicated that the party’s internal fight had weakened the hand of its leaders.
“Everybody acknowledges that because of the dust-up yesterday we’ve lost some leverage,” said Rep. Steven LaTourette, R-Ohio. “You can say it’s remote, but there was a chance that the package yesterday, if it had been successfully voted out, would have been adopted by the Senate and signed by the president. I think everybody acknowledges that’s not going to happen with this piece of legislation.
“I don’t think anybody thinks that this bill is going to be passed as is by the Senate. It’s going to come back to us, and we’ll take a look at it,” he said.
McConnell dismissed the Democratic effort on Reid’s bill, arguing that it stands no chance in the GOP-controlled House, and he accused Obama of pushing the nation to the brink of an economic abyss.
“If the president hadn’t decided to blow up the bipartisan solution that members of Congress worked so hard to produce last weekend, we’d be voting to end this crisis today,” McConnell said on the Senate floor.
In his brief White House remarks, Obama made a fresh appeal to Americans to contact members of Congress.
The office of the Architect of the Capitol reported that the main phone circuit was near capacity. It said outside callers were occasionally getting busy signals as a result of the heavy volume.
Congressional phone lines and websites became overloaded earlier in the week after Obama asked people to contact their lawmakers about the stalemate.
Obama also asked his 9.4 million followers on Twitter to send tweets to Republican lawmakers “and urge them to support a bipartisan compromise to the debt crisis.” Obama’s Twitter feed planned to send out the Twitter handles of several lawmakers, starting with Republican Sens. Lisa Murkowski of Alaska and Jeff Sessions and Richard Shelby of Alabama.
“The time for putting party first is over. If you want to see a bipartisan (hash)compromise, let Congress know. Call. Email. Tweet,” Obama wrote in a tweet, signed “-BO.”
On Thursday, Boehner, R-Ohio, suffered a stinging setback when, for a second day, he had to postpone a vote on his proposal to extend the nation’s borrowing authority while cutting federal spending by nearly $1 trillion.
“Obviously, we didn’t have the votes,” Dreier said after Boehner and the GOP leadership had spent hours trying to corral the support of rebellious conservatives.
If Republicans now can get Boehner’s version through the House, a rapid and complex set of choices will determine whether and how a debt crisis can be averted. House Republicans will be under tremendous pressure to pass something, even if they have to make it so appealing to their right wing that the nation’s independents and centrists will scorn it. As Thursday’s events proved, nothing is guaranteed.
The main area of dispute between the two parties is how to encourage or guarantee big spending cuts in the future without rekindling a fiercely divisive debt-ceiling debate such as the one now raging.
Interviews with well-placed insiders suggest the following road map, assuming Boehner can get his bill out of the House:
The Democratic-controlled Senate would kill it quickly. The focus then would fall on the Senate’s two leaders, Reid and McConnell. They must decide whether they can reach a compromise that can pass the Senate – where a united GOP can kill bills with filibusters – and then pass the House and be signed by Obama. The White House would be integral to such talks.
Republican officials say McConnell could hold a strong hand, despite the House’s shaky performance. He could argue that the House finally passed a bill to raise the debt ceiling, while the Senate has done nothing but kill that bill. If Tuesday’s deadline passes with no resolution, Republicans say, voters will blame Democrats.
Under this thinking, the Senate would pass a measure similar to the House bill, perhaps with minor changes to save face and give political cover to Democrats who vote for it. The House would quickly concur, with numerous Democrats and all but the most conservative Republicans voting aye. Obama would have no choice but to sign it.
Democrats say the opposite is true. Obama has persuasively argued in recent weeks that Republicans are unreasonably demanding, they say.
Democrats control the Senate and White House. If Republicans insist that a partisan, House-passed bill is the only vehicle, then public anger will fall on them, this thinking goes.
A $900 billion debt-limit hike would come first, coupled with $917 billion in spending cuts over 10 years. Under the Boehner revision, approval of a balanced-budget constitutional amendment would open a path to another $1.6 trillion in borrowing power, provided that Congress and the president have agreed to another round of spending cuts of that amount or more.
Obama has consistently rejected this condition. He says it would hurt the economy and touch off another ferocious political fight over the debt ceiling, which Congress previously raised with little fuss year after year. Global markets and investors would not be reassured by such a drawn-out, uncertain scenario, he says.
Associated Press writers David Espo, Alan Fram, Ken Thomas, Jim Kuhnhenn, Erica Werner and Ben Feller contributed to this report.