WASHINGTON — House Speaker John A. Boehner said last night that Republicans would insist on trillions of dollars in federal spending cuts in exchange for their support of an increase in the federal debt limit sought by the Obama administration to prevent a government default.
In his most specific statement to date on what Republicans will demand in the debt-ceiling fight, Boehner told the Economic Club of New York that the level of spending reductions should exceed the amount of the increase in borrowing power.
“Without significant spending cuts and changes to the way we spend the American people’s money, there will be no debt-limit increase,’’ Boehner told members of New York’s business and finance community.
Boehner said those cuts should be in the trillions of dollars, not billions.
In the speech, delivered ahead of a second round of debt-limit negotiations with the White House and Senate Democrats today, Boehner did not provide a time frame for when the reductions would have to be imposed.
His address came after a leading Senate Democrat, Charles E. Schumer of New York, accused Boehner of “playing with fire’’ by holding the debt-limit increase hostage to a push for spending cuts and budget restrictions.
“The idea of refusing to raise the debt ceiling should be taken off the table,’’ Schumer said in a conference call with reporters.
In his remarks, the speaker expressed strong resistance to the effort by some Senate Democrats and President Obama for an alternative to enacting specific spending cuts as the price for increasing the debt limit: “triggers’’ that prompt automatic spending reductions and perhaps tax increases if Congress and the White House do not meet targets for lowering the deficit in coming years. That idea has emerged as providing the potential for compromise over the debt increase.
Boehner said the reductions should be “actual cuts and program reforms, not broad deficit or debt targets that punt the tough questions to the future. And with the exception of tax hikes — which will destroy jobs — everything is on the table.’’
Acknowledging that many in the financial world are uneasy about the prospect that the government might not be able to make good on its financial obligations, Boehner said it would be more damaging to the nation if Congress granted the administration’s request without taking steps to curb deficit spending and bring down the federal debt.
“It would send a signal to investors and entrepreneurs everywhere that America still is not serious about dealing with our spending addiction,’’ Boehner said. “It would erode confidence in our economy and reduce the certainty for small businesses. And frankly I think it would kill even more American jobs.’’
The administration has not specified the amount of the increase it is seeking in the $14.3 trillion debt limit, but the previous increase, in 2010, was just under $2 trillion, and estimates are that a similar amount would be required to avoid a second vote on the debt limit before the 2012 elections.
Boehner also said that the debt talks should include “honest conversations’’ about how to rein in the costs of the Medicare program, and he advocated fundamental changes. Other senior Republicans acknowledged last week that any changes to the health insurance program for older Americans are unlikely to incorporate the party’s proposal to begin providing private insurance subsidies for future retirees.
Schumer and Roger C. Altman, an investment banker and former Clinton administration Treasury official, said the consequences for the nation’s economy could be dire if the government defaulted for the first time in its history or if the debt-ceiling talks were pushed to the brink.
“If America were to default, even for 24 hours, that would have an unprecedented and a catastrophic impact on global financial markets and on American markets,’’ Altman said.
But Boehner said the debt-limit fight provided a unique opportunity.
“I don’t want to allow this moment that we have in our history to pass without real action to solve our long-term economic problems,’’ he said. — NEW YORK TIMES
Heller, 50, was serving his third term in the House when Republican Governor Brian Sandoval selected him to serve the remainder of Ensign’s term.
The transition does little to change the political dynamic in the Senate, as Heller and Ensign shared similar views on most issues. Heller was already the favorite to win next year’s GOP primary election for Ensign’s seat when Sandoval made the appointment. On the Democratic side, Representative Shelley Berkley has said she will run for the seat. — ASSOCIATED PRESS