WASHINGTON—House of Representatives Speaker John Boehner, facing a Republican revolt by tea party conservatives amid revelations that his debt-ceiling plan would not cut as much spending as advertised, was forced to delay a vote on legislation just a week before an August 2 deadline for staving off the potential financial chaos of America’s first-ever default.
Even with time running out and the Treasury’s ability to pay the nation’s bills at stake, the speaker promised to quickly rewrite his legislation to increase the US debt limit after budget officials said its planned spending cuts didn’t add up.
Many analysts have predicted dire consequences for the US and global economies if the United States defaults. Credit-rating agencies have threatened to downgrade the United States’ gold-plated AAA rating if Congress and the White House don’t extend the debt ceiling and take steps to bring long-term deficits under control.
Congressional veterans say a final-hour bargain can’t be reached until both parties prove that neither the Democrats’ top goals nor the Republicans’ can be reached in the divided Congress.
While Democrats have apparently dropped their demand for tax increases for the wealthy, the main sticking point remains how many trillions of dollars to cut in exchange for a critical increase in the government’s $14.3- trillion debt limit.
An official congressional analysis late Tuesday said Boehner’s plan would produce smaller savings than originally promised—less than $1 trillion in spending cuts over the coming decade rather than the $1.2 trillion he estimated on Monday.
While Boehner searched for votes within House Republican ranks, some Americans seemed to edge closer to the notion that the August 2 deadline might pass without a solution. The stock market fell again, although not dramatically.
Public clashing between Democratic President Barack Obama and the Republicans showed no sign of easing. The White House declared Obama would veto the Republican bill, even if it somehow got through the House and the Democratic-controlled Senate.
IN PHOTO -- Hous e Speaker John Boehner of Ohio (center) gestures during a news conference on Capitol Hill in Washington on Tuesday. From left are Rep. Jason Chaffetz, R-Utah; House Majority Leader Eric Cantor of Virginia; House Majority Whip Kevin McCarthy of California; Boehner; Rep. Renee Ellmers, R-North Carolina; and Republican Conference Chairman Rep. Jeb Hensarling, R-Texas. --AP
