Speier irked by debate on debt ceiling

San Mateo Daily Journal
By Bill Silverfarb

Republicans in Congress continue to refuse to raise the nation’s debt ceiling without first gaining major concessions from the White House, a fact that leads U.S. Rep. Jackie Speier to say negotiations between President Barack Obama and GOP leadership is more about politics and less about the nation’s financial health.

Congress has until Aug. 2 to raise the $14.5 trillion debt ceiling before the Treasury Department says it will be unable to pay the country’s bills on time and in full.

Typically, the debt ceiling is raised without much fanfare. However, this year Republicans have refused to take the vote until the White House and Democrats agree to slash spending without raising taxes.

It is a Republican tactic, Speier, D-San Mateo, said to weaken the president.

“This is about winning the presidency,” Speier said. “If unemployment remains high and the economy poor, Republicans think they may be able to recapture the presidency in 2012. They are putting party before country.”

Meanwhile, Moody’s Investors Services said yesterday it is putting the sterling bond rating of the United States on review for a possible downgrade.

The United States has a AAA rating, making U.S. Treasury bonds one of the safest bets for investors.

That could change, however, if the country defaults on any of its loan payments.

Much of the debt, Speier said, is related to the wars in Iraq and Afghanistan that started piling up under the Bush administration.

To reduce the deficit, Obama offered $3 trillion in cuts to federal programs while raising $1 trillion new taxes.

But Republicans have not been willing to support additional taxes.

California’s senior Republican official in Congress is U.S. Rep. David Dreier, who told the Daily Journal yesterday that the debt ceiling should be raised.

“While I believe we cannot fail to increase the debt ceiling and meet our financial obligations, I also believe it is critical that we reduce the size and scope of the federal government and get our debt under control,” said Dreier, R-San Dimas.

The ultimate goal should be job creation and getting Americans back to work, he said.

Republicans have called for deep cuts to Medicare and even Social Security, two items Speier and U.S. Rep. Anna Eshoo, D-Palo Alto, said should not be a part of any vote on raising the debt ceiling.

Social Security has nothing to do with the national debt, both contend, and should not be a part of any discussions on reducing the debt.

Eshoo said she is willing to discuss Medicare cost savings but not as part of debt ceiling negotiations.

The debt ballooned in part, Speier said, because of tax cuts extended to the wealthiest Americans under the Bush administration.

“We spend money on giveaways for the wealthiest and we can’t afford it,” Speier said.

The debt ceiling could be raised incrementally, without Republican support, if negotiations fail on reducing the deficit.

The consequences of not raising the debt ceiling by Aug. 2 could lead to more layoffs, interest rate hikes and higher mortgages and significant losses to pension funds, Speier said.

“Republicans are gambling with the country’s economic strength,” she said.

Last night, negotiations at the White House ended early as Obama indicated to Republican officials that he wants the deal done now.

Obama reportedly said “enough is enough” with respect to delay and refusal to compromise by Republicans, a White House official said.

On Sunday, Obama said he wanted a deal on the debt ceiling in 10 days. 

Click here to read the original article.