'Fiscal cliff' deal: After rush of relief, debt ceiling clash already looms
The 'fiscal cliff' deal passed the House after Republicans broke ranks over taxes. But spending cuts loom large in the next clash, over raising the debt ceiling, which Obama says is nonnegotiable.
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“On spending, which is the real problem, this classic Washington deal is worse than doing nothing,” said Rep. Jim Jordan (R) of Ohio, the former head of the Republican Study Committee, the conservative wing of the House GOP caucus.Skip to next paragraph
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“We'll never get the budget balanced by delaying the few spending cuts that were agreed to in the summer of 2011.”
The fiscal cliff negotiations began with a strong advantage to the Obama White House: Had Congress refused to come to a deal, all the Bush-era tax cuts would automatically expire, and polls showed that the public would have blamed Republicans.
But in the next clash over debt and spending, it’s the White House that is asking to increase the debt limit. Failure to resolve differences would lead to an unthinkable default on the national debt and another downgrade of the US credit rating.
House Speaker John Boehner of Ohio began the 2011 debt-limit negotiations with a new principle he said was nonnegotiable: that is, that every dollar increase in the debt limit must be accompanied by a dollar of spending cuts. That's why Congress set up the automatic spending cuts as part of what came to be known as the fiscal cliff as a bid to force concessions on spending.
But with the two-month delay of the sequester in the fiscal-cliff bill, spending once again must be resolved in the same time frame as a high-stakes decision over raising the debt limit, whether or not the White House objects to combining the two issues.
Republicans are divided over how aggressively to push the debt-ceiling negotiations in a new round with the White House. Last month, Mr. Boehner, who is up for relection as speaker on Jan. 4, offered to defer a fight over raising the debt limit for a year, as part of negotiations with Obama over a “grand bargain.” But he has taken a battering from some conservative activist groups and members of his own caucus for those failed negotiations.
Conservative groups see the debt ceiling as a point of maximum leverage on spending and are urging Boehner to again insist on "the Boehner rule" and use it as a point of maximum leverage.
“The mass majority of Americans know the danger we’re putting ourselves in and want less debt,” says Chris Chocola, president of the Club for Growth, best known for funding primary campaigns against GOP incumbents viewed as not conservative enough.
“It’s up to Republicans to tell this story, and they have more leverage [in debt-ceiling negotiations] than they did in the fiscal cliff debate,” he adds. “If they’re not willing to go there, they have nothing.”
But after tough 2012 elections, some House Republicans are wary of confronting the White House on an issue so potentially damaging to the economy.
"A lot of people talk about the debt ceiling, but I don’t want to be messing around with the obligations of the federal government,” says Rep. Jim Renacci (R) of Ohio, a veteran of the 2010 tea party class. “We can use that for some leverage, but we should be using every opportunity to cut debt.”
“After two tough races, I did not come here to continue the status quo,” he adds.
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