(CNSNews.com) – Two days after House Majority Leader Eric Cantor (R-Va.) dodged the question of whether Republicans would insist that any increase in the debt limit in this fiscal year would be exceeded by spending cuts in this fiscal year, the congressman walked out of debt/budget talks with Vice President Joe Biden, stating he could not continue as long as the Democrats insisted that taxes be raised as part of a budget deal.
House Speaker John Boehner (R-Ohio), meanwhile, maintained that tax increases were off the table and that spending cuts should exceed any increase in the federal debt limit.
“Each side came into these talks with certain orders, and as it stands the Democrats continue to insist that any deal must include tax increases,” said Cantor in a statement released on Thursday. “[T]he tax issue must be resolved before discussions can continue. Given this impasse, I will not be participating in today’s meeting.”
Both Cantor and House Speaker John Boehner (R-Ohio) have consistently said that any budget deal for the remainder of fiscal year 2011 and a vote on raising the debt limit--from $14.29 trillion to potentially $16.79 trillion (a $2.5 trillion increase)--would not include raising taxes.
After Cantor left the talks with Biden, along with Sen. Jon Kyl (R-Ariz.), Boehner held a press conference and said, “Listen, we’ve got to stop spending money that we don’t have and, since the beginning, the Majority Leader [Canotor] and myself, along with Sen. McConnell and Sen. Kyl have been clear: tax hikes are off the table.”
“First of all: raising taxes is going to destroy jobs,” said Boehner. “If you raise taxes on the people that we need to grow our economy and to hire new workers, guess what? They’re not going to do it if they have to pay higher taxes to the federal government.”
“Second, a tax hike cannot pass the U.S. House of Representatives,” said the Speaker. “It’s not just a bad idea, it doesn’t have the votes and it can’t happen. And third, the American people don’t want us to raise taxes. They know that we’ve got a spending problem. That’s why Republicans passed a budget [drafted by Rep. Paul Ryan of Wisconsin] that pays down debt over time without raising taxes.”
Boehner, in May and early June, also maintained that federal budget cuts must exceed any increase in the debt limit, I.e., If the debt limit goes up $2.5 trillion, then spending cuts must exceed $2.5 trillion.
“So let me be as clear as I can be,” Boehner told the Economic Club of New York on May 9. “Without significant spending cuts and reforms to reduce our debt, there will be no debt-limit increase. And the cuts should be greater than the accompanying increase in debt authority the president is given. … We should be talking about cuts of trillions, not just billions. They should be actual cuts and program reforms, not broad deficit or debt targets that punt the tough questions to the future.”
Then, on May 26, Boehner said: “Without significant spending cuts and reforms to reduce our debt, there will be no debt limit increase. And the cuts should be greater than the accompanying increase in debt authority the president is given.” On June 1, Boehner said, “The fact is, if we’re going to raise the debt limit, the spending cuts should exceed the increase in the debt limit.”
When CNSNNews.com asked Majority Leader Cantor on Tuesday whether Republicans were insisting that cuts this fiscal year exceed any increase in the debt limit this fiscal year, however, the congressman dodged the question. CNSNews.com asked Cantor, “Are you insisting that any increase in the debt limit in this fiscal year be exceeded by spending cuts that take effect in this fiscal year? Or are you willing to trade an immediate increase in the national debt for spending cuts that take place sometime in the future?”
Cantor said, “Well, what we’ve said all along is that if we’re going to increase the debt ceiling it has got to be accompanied with real reforms and big spending cuts.”
“What we’re driving towards is as much, as many, cuts in as large of a reform as we possibly can achieve, because you can look at it over the first year, the second year, the first 10-year budget window or long-term managing down the debt and the deficit and that’s where I think the markets are looking poor,” said Cantor. “"I think that the people who put us here are looking to see that we have changed the way the system works so that we’re no longer spending money we don’t have, living by the same standard that most people live in their same households and their businesses.”
When asked for a definitive answer, Cantor’s press office did not respond.
At his Thursday press conference, Boehner maintained his position that federal budget cuts must should exceed any debt-limit increase and taxes must not go up.
“Democrats don’t have a plan for jobs,” said Boehner. “You heard them say again yesterday: What do they want? More ‘stimulus’ spending and higher taxes. Well, on the same day that the CBO called our debt crisis ‘daunting,’ Democrat leaders came out and asked for more spending. Now if you recall, we tried this: it’s called the ‘stimulus’ plan.”
“I want to reiterate that we will not agree to the president’s request to increase the debt limit without serious spending cuts and reforms to the way we spend the American people’s money,” said Boehner. “As I’ve said before, the spending cuts must be greater than any increase in the debt limit. And these have to be real spending cuts – no ‘targets’ to push this question off to the long term.”
“No more kicking the can down the road,” he said. “And the reason for this is simple: a debt limit [bill] that fails this test will hurt the economy, impede job growth by intensifying the uncertainty about our nation's ability to deal with our long-term fiscal problems.”
The debt limit is the amount of money that the government can legally borrow. That amount is voted on by Congress and it must be signed into law by the president. The limit has been raised 10 times since 2001. The last debt limit increase – from $12.29 trillion to $14.29 trillion (up $1.9 trillion) – was signed into law by President Barack Obama on Feb. 12, 2010.
That limit, $14.29 trillion, was surpassed by the government on May 16. To keep the government operating, the U.S. Treasury, headed by Secretary Timothy Geithner, has suspended payments into two federal pension programs. This will allow the Treasury to continue borrowing money up to about Aug. 2.
Both Democrats and Republicans have said they want to hold a vote on raising the debt limit before Aug. 2. Geithner said on May 16 that Congress needed to vote on raising the debt limit “in order to protect the full faith and credit of the United States and avoid catastrophic economic consequences for citizens.”
Thirty years ago, the national debt was $908 billion. Since then, the debt has gone up more than 1,300 percent – beyond $14.29 trillion.