After the defeat of the Harry Reid bill in the House yesterday, Barack Obama is back in the debt ceiling negotiations, giving in the Republicans as the running National Debt clock ticks away. A new debt ceiling proposal based on the House Speaker John Boehner bill is gaining ground. As a result, the Senate will delay their vote on the Harry Reid plan to raise the debt limit till this afternoon, and even that is doubtful. Already many question how the Senate blocks vote on the older Boeher debt ceiling proposal. Harry Reid and Nancy Pelosi are unhappy but John Boehner and Mitch McConnell are more optimistic that a deal can be reached before the August 2 deadline. So let us look at the latest U.S. debt update to see where we are.
The latest proposal on the table will raise the debt ceiling by $2.4 Trillion dollars, which is the main item that the White House wants. For the Republicans, they get $1 Trillion dollars in spending cuts immediately, though spread out over the next ten years, as well as their ′super-commission′, a bipartisan board from both the House and the Senate to detail an additional $1.8 Trillion in cuts. The super-commission has until December to find those cuts, otherwise it will automatically trigger across-the-board spending cuts, including in defense and entitlement programs. Perhaps most importantly is that the new deal will mandate a vote for a balanced budget amendment in both the House and Senate.
According to some sources, Harry Reid and Nancy Pelosi were quite upset after a meeting at the White House which followed the House defeating the Reid bill. What got them in a lather was learning that Obama was talking with Boehner and McConnell without Reid′s or Pelosi′s knowledge. Perhaps all of those new poll numbers showing Obama′s job approval rating at its lowest level convinced him that it was time to cave in on several key Republican demands, including no revenue increases. Later, Reid tried to spin the case that tax increases were still on the table, but it appears unlikely that such would be included in the latest deal.
After the Senate blocks vote on the House Speaker John Boehner bill, the House paid back by actually voting down the Harry Reid bill, or at least a ′mirror′ of it. This forced Barack Obama to cave on the debt ceiling negotiations, giving House Republicans nearly all of what they wanted. With only two days to go as the running National Debt clock ticks away, it looks like a deal to raise the debt limit may finally be close according to the latest U.S. debt update. Sources say that Boehner has 40 House Republicans, known as the ′Tuesday Club′, who are ready to vote for anything in order to avoid a government shutdown and possible bond rating downgrade.