White House debt talks collapse

[Gerald]

Republican House Speaker John Boehner has walked away from crunch debt ceiling talks at the White House with US President Barack Obama.

Mr Obama said Mr Boehner had rejected an "extraordinarily fair deal" that would have included $650bn (£400bn) of cuts to entitlement programmes.

The president said he had been willing to take "a lot of heat" from his party.

Mr Boehner told a news conference afterwards that Mr Obama had "moved the goal posts" by demanding a tax hike.

President Obama said he wanted a meeting with congressional leaders, including Mr Boehner, at the White House at 1100 (1500 GMT) on Saturday.
'Left at the altar'

The negotiations are aimed at avoiding what analysts say would be an economically catastrophic US debt default on 2 August.

"It is hard to understand why Speaker Boehner would walk away from this kind of deal," President Obama said at a news conference on Friday evening.

"There are a lot of Republicans who are puzzled as to why it couldn't get done."

As well as cutting $650bn from Medicare, Medicaid and other entitlements, the president said he was offering to slash $1tr in discretionary spending, while seeking $1.2tr in revenues, which could have been achieved by raising income tax rates.

In a rebuttal news conference later on Friday evening, Mr Boehner said they had been close to a deal until Mr Obama had demanded $400bn in tax increases on top of about $800bn in revenues that would have been reaped through a comprehensive rewrite of the tax code.

"Dealing with the White House is like dealing with a bowl of Jell-O," Mr Boehner said.

He told reporters he did not think his relationship with Mr Obama had been "irreparably damaged", and that he would attend Saturday's meeting.

White House correspondents said Mr Obama looked visibly angry as he told reporters he, too, thought a deal had been close until Mr Boehner did not return a phone call made by the president earlier on Friday.

"I've been left at the altar now a couple of times," Mr Obama said of the talks with Mr Boehner.

For the first time, Mr Obama publicly countenanced the possibility of the US not meeting its financial obligations.

"If we default, then we're going to have to make adjustments," he said.

Moments later, the president added he remained confident the $14.3tn limit on US borrowing would be raised by the 2 August deadline.

Mr Obama also said he was "fed up" with political posturing.
'We couldn't connect'

In a letter to the Republican rank and file, Mr Boehner said: "A deal was never reached, and was never really close.

http://www.bbc.co.uk/news/world-us-canada-14258888


Note: 23 July 2011 Last updated at 01:10 GMT

[STEED]

Print more money!

[Gerald]

Talk to Bernanke, about that ... maybe he can push up some £ banknotes also...

[STEED]

Its amazing that these people who we trust just can not or will not do anything right. Sounds like the US has got a bunch of monkeys just like here in the UK. And the likes of the every day folk are always the ones who get it in the neck.

[krashkart]

In summary:
Rather than do the reasonable thing and try a little harder to reach a compromise with the President, Boehner gave up and walked away in a tiff. Thanks a trillion, John. Now I know what you're really made of.

I think I'm just gonna go cry for a little while, ladies and gentlemen.

Originally Posted by STEED

Its amazing that these people who we trust just can not or will not do anything right. Sounds like the US has got a bunch of monkeys just like here in the UK. And the likes of the every day folk are always the ones who get it in the neck.

It's a small world after all.

[Alex]

Originally Posted by STEED

Sounds like the US has got a bunch of monkeys

Did that constant smelly american patriotism you often read and hear about everywhere on the internet and at tv ever made you have any doubt about that ?

The Strauss Kahn affair alone sums up the frailty of the country and its judicial system. To sum up things shortly, the conclusion of what we've got to hear at tv in here is "well, yes, as you can see, the american legal system doesn't look like ours at all. Different, yes, but we should not consider it inferior to ours, after all that guy got the best lawyers there, so let's see what's going to happen. We should not underestimate the united states of America, even though they've been showing him at tv surrounded by cops just as if he was guilty. We are just not used to make anything look cinematic, they are used to make everything look as if it came out of an Hollywood movie".
I've never supported the political movement that guy is part of. Plus he definitely is famous in here for being found deceiving his wife a certain number of times. But still, seeing his name and himself - one of the wealthiest persons in the country, purely and simply - being dragged through that mud the american media is - that made it all look like the greatest ass-kicking of all time - by a *cough* cleaning lady whose husband got involved in drug trafficking, without any presumption of innocence (that's supposed to be the right of every accused person) in the beginning, really makes me wonder about the legitimacy and lawfulness of the american judicial system and media. That woman has been no more than a tool in that affair, but still : that bast%rd went from the status of accused to the one of accuser in a matter of days, how incongruous is that ?!
Yet I'm sure someone will show up shortly just to say he's so proud of being A(!)merican. Just let me say I'm ROFLing, and I'm not the only one.

I'm thankful to the united states though, I must admit.
I've never appreciated my country, I mean, never, especially when it comes to social inequalities, breach of moral standards, absence of ethics of the media, and the like. I only start appreciating it nowadays, now that I see what takes place on the other side of the Atlantic.

[joegrundman]

it's hardly the same thing as in the UK.

the UK is ultimately just a bigger version of Greece. It can get away with this stuff.

The US is different.

You default, the whole western project is in great danger. The US cannot survive in its present form with a default.

It amounts to pure robbery of China, and you cannot be the country you are and do that.

It is time to grow up and do the right thing. Raise the debt limit. Then argue like hell about how to pay off the debt.

You have to accept the Democrats are the legitimate government of the day so they have to be allowed to have the deciding vote. The repubs can argue against it, win the next election and put into effect THEIR plan for deficit reduction. But in the meantime they must not crash the car rather than let the dems drive. That's how democracy must be allowed to work.

If you don't do it you a) seriously risk the economic foundation of the western system (and europe is not presently in a position to pick up the slack) and b) you demonstrate the fundamental weakness of democracy as a long term system at a very important time in the world-historical trajectory.

[krashkart]

Originally Posted by joegrundman

Then argue like hell about how to pay off the debt.

That's what they've been doing all along. That is all they have been doing. There is no agreement at this point about which programs to trim and which taxes to raise. What we have right now is one half of the system effectively walking off the field because they will not compromise with the President. They absolutely refuse to yield to common sense and take the higher road in this matter. They want the upper hand, no matter the cost to the rest of us.

[joegrundman]

i know. but let the debt ceiling rise - then carry on the argument.

my bet is that this is still just brinkmanship and there will be a deal once they feel that every last concession that can be wrung has been.

But we are nonetheless staring into the abyss here.

[krashkart]

I hope you're right, joe.

[mookiemookie]

Obama had a good quote on this situation:

“Unfortunately, Congress consistently brings the Government to the edge of default before facing its responsibility. This brinkmanship threatens the holders of government bonds and those who rely on Social Security and veterans benefits. Interest rates would skyrocket, instability would occur in financial markets, and the Federal deficit would soar. The United States has a special responsibility to itself and the world to meet its obligations. It means we have a well-earned reputation for reliability and credibility—two things that set us apart from much of the world.”

Just kidding. That was Reagan. This crap has been going on for years. Ideological idiots on both sides.

tomorrow is coming and with it new problems

[joegrundman]

i shouldn't be too sanguine, mookie mookie. things are not A-OK in planet america.

[Kazuaki Shimazaki II]

What good is the Executive Branch of government, if it can't make decisions that need making faster than the Legislative branch can make it?

[gimpy117]

boo hoo! my rich buddies might actually have to pony up a little bit more after a decade of almost unprecedented prosperity! I'm taking my marbles and going home!

just the party of no refusing to compromise on anything. we say black they say white, we say how about a shade of grey and they say no, and precede to hold to USA hostage to get their way. I keep waiting to see if they'll get a clue and realize that a balanced budget and the bush tax cuts is way harder than if we took a more balanced approach.

the sad part is, the Gang of six is going to have to propose a lowering of the top tax rate just to get the debt ceiling raised. I'm sure the uber rich are already rubbing their palms together, because even though they are taxed 35%, they only pay something like 18% effectively ( I myself pay more than that), and with the cuts they may pay 14-16% after this deal (assuming they don't close some major loopholes).

I think it's sad that somebody who makes millions, has shiny cars, big houses...the good life can get away with a lower contribution to a society that has been so good to them than somebody making enough for the lowest tax bracket.