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WASHINGTON (AP) — Legislation aimed at keeping the government’s
bill-paying intact is stuck in neutral, putting Congress, the
financial markets and the public on edge less than a week before
the deadline for heading off a potentially calamitous
default.
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House Speaker John Boehner was forced late Tuesday to postpone a
floor vote on his plan, which originally had been scheduled for
Wednesday, after nonpartisan congressional scorekeepers said the
proposal would cut spending less than advertised. He promised to
rewrite the measure, but the move means the House can’t vote on it
until Thursday at the earliest.
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Yet despite the stalled measure – and angry partisan rhetoric – the
differences between the sides are narrowing, not widening.
Boehner’s plan represents significant movement from a bill the
House passed last week, roughly half of its mandated spending cuts,
for example. And Senate Democratic leader Harry Reid no longer is
insisting on having tax increases as part of any plan to cut
deficits.
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Boehner, R-Ohio, needs to do more than pump up the legislation. He
needs to shore up his standing with tea party-backed conservatives
demanding deeper spending cuts to accompany an almost $1 trillion
increase in the government’s borrowing cap. Many conservatives
already had promised to oppose it.
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“We need more drastic cuts,” said Rep. Jason Chaffetz, R-Utah. “I
can’t support it in its current form.”
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“I’m searching for a path toward yes but having a difficult time
finding it,” said Rep Bill Huizenga, R-Mich.
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Unless he can wrestle the situation under control, Boehner risks
losing leverage in his dealing with President Barack Obama and
Democrats controlling the Senate.
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Boehner’s plan was not winning converts among some stalwart
conservatives. It prompted Reid to declare that the bill was
destined to fail in the Senate and it drew a White House veto
threat. But it was framing the debate over how to reduce long-term
deficits while raising the debt ceiling.
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Tuesday’s Congressional Budget Office analysis said the GOP measure
would cut the deficit by about $850 billion over 10 years, not the
$1.2 trillion originally promised. Even more embarrassing was a CBO
finding that the measure, which would provide a $900 billion
increase in the nation’s borrowing cap, would generate just a $1
billion deficit cut over the coming year.
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Boehner’s plan would couple budget savings gleaned from 10 years of
curbs on agency budgets with a two-track plan for increasing the
government’s borrowing cap by up to $2.7 trillion. The first
increase of $900 billion would take effect immediately; the second
increase could be awarded only after the recommendations of a
special bipartisan congressional panel are enacted into
law.
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The White House says Boehner’s measure would reopen the delicate
and crucial debt discussions to unending political pressure during
next year’s campaigns and risk more uncertainty in the
markets.
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The White House promised to veto Boehner’s measure if it were to
reach Obama’s desk.
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It’s unlikely to come to that. Reid, D-Nev., promised the measure
would never make it through the Democratic-controlled
Senate.
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Reid held back on forcing a vote on his competing measure, which he
unveiled Monday to poor reviews from Republicans like Senate
Minority Leader Mitch McConnell of Kentucky. Reid appears to hope
that his measure, which promises $2.7 trillion in spending cuts and
would increase the debt limit enough to keep the government afloat
past the 2012 elections, could emerge as the last viable option
standing and could be modified with input from
Republicans.
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Those same Republicans blasted Reid’s bill for $1 trillion in
war-related savings they say are phony. But McConnell is emerging
as a key figure in the endgame, and he sounded a conciliatory note
in an appearance Tuesday.
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“We need to get an outcome. And to get an outcome, a Republican
House, a Democratic Senate and a Democratic president would have to
reach an agreement,” McConnell said. “So I’m prepared to accept
something less than perfect, because perfect is not
achievable.”
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One area of potential compromise could be how to treat the findings
of a bipartisan congressional commission to identify further
deficit reductions, especially in major health care programs such
as Medicare and Medicaid. Both Reid and Boehner support the idea,
though Boehner wants to make a future increase in the debt limit
contingent on the proposed additional cuts being enacted into
law.
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Meanwhile, the clock was ticking down to next Tuesday’s deadline to
continue the government’s borrowing powers and avert possible
defaults on U.S. loans and obligations, like $23 billion worth of
Social Security payments due Aug. 3. The Capitol’s telephones were
jammed after Obama urged the public to contact their
representatives in his Monday night address.
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Conservative bloggers and groups like the Club for Growth, which
funds primary campaigns against Republicans it deems too squishy in
their conservatism, denounced Boehner’s bill as too weak. The U.S.
Chamber of Commerce, closer to the GOP mainstream, urged
support.
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While Boehner searched for votes, some Americans seemed to edge
closer to the notion that the Aug. 2 deadline might pass without a
solution. The stock market fell again, although not dramatically.
California planned to borrow about $5 billion from private
investors as a hedge against a possible federal government
default.
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The White House spoke with veterans groups about what might happen
to their benefits if a deal isn’t reached. Obama has said he can’t
guarantee Social Security checks and payments to veterans and the
disabled would go out on schedule.
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Freshman Rep. Trey Gowdy, R-S.C., bristled at the idea that tea
party-influenced newcomers are sheep-like ideologues willing to
risk default.
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“We’re not a bunch of knuckle-dragging, mouth-breathing
Neanderthals,” Gowdy said. “We’re interested in answering what we
perceive to be the mandate, which is to stop the spending and
change the way Washington handles money.”
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Gowdy said he was leaning against Boehner’s proposal.
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