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| Obama warns GOP against using debt ceiling as leverage in fiscal cliff fight | Obama warns GOP against using debt ceiling as leverage in fiscal cliff fight |
| (30 days later) | |
| Barack Obama has issued a stern warning to Republican leaders that they should not contemplate a repeat of last year's disastrous fight over the US debt ceiling as part of their strategy over the current talks to avoid the fiscal cliff. | Barack Obama has issued a stern warning to Republican leaders that they should not contemplate a repeat of last year's disastrous fight over the US debt ceiling as part of their strategy over the current talks to avoid the fiscal cliff. |
| Obama said that the 2011 debt ceiling crisis, which culminated in the historic downgrading of the Standard & Poor's credit rating of US government bonds, was a "catastrophe" that he would not allow to happen again. He cautioned Republican leaders in Congress against assuming they could accede to his demand for tax increases for the rich in the current fiscal cliff talks, with the intention of hitting back in 2013 with a call for stringent spending cuts in exchange for raising the government's borrowing limits. | Obama said that the 2011 debt ceiling crisis, which culminated in the historic downgrading of the Standard & Poor's credit rating of US government bonds, was a "catastrophe" that he would not allow to happen again. He cautioned Republican leaders in Congress against assuming they could accede to his demand for tax increases for the rich in the current fiscal cliff talks, with the intention of hitting back in 2013 with a call for stringent spending cuts in exchange for raising the government's borrowing limits. |
| "That's a bad strategy for America, and a bad strategy for your businesses," Obama told the CEO association, Business Roundtable, in Washington. "That's not a game I will play." | "That's a bad strategy for America, and a bad strategy for your businesses," Obama told the CEO association, Business Roundtable, in Washington. "That's not a game I will play." |
| With the standoff between the two main parties continuing, and the 1 January deadline approaching for the automatic advent of $607bn of tax rises and spending cuts, Obama is standing firm on his central negotiating requirement: a tax rate rise for the top 2% of earners. | With the standoff between the two main parties continuing, and the 1 January deadline approaching for the automatic advent of $607bn of tax rises and spending cuts, Obama is standing firm on his central negotiating requirement: a tax rate rise for the top 2% of earners. |
| He said that if Republicans were prepared to make a "conceptual breakthrough" on the need for an increased tax burden on the wealthy, then "we can solve this in a week. It's not that tough." | He said that if Republicans were prepared to make a "conceptual breakthrough" on the need for an increased tax burden on the wealthy, then "we can solve this in a week. It's not that tough." |
| But the GOP leadership believe they have done enough for now to move in the president's direction and are arguing that the ball is back in his court. They point to the release of a joint letter from House Republican leaders setting out their latest offer that includes increased tax revenues through closing loopholes and deductions. John Boehner, the speaker of the House and the letter's lead signatory, called on Obama to respond to the proposals. | But the GOP leadership believe they have done enough for now to move in the president's direction and are arguing that the ball is back in his court. They point to the release of a joint letter from House Republican leaders setting out their latest offer that includes increased tax revenues through closing loopholes and deductions. John Boehner, the speaker of the House and the letter's lead signatory, called on Obama to respond to the proposals. |
| "We can't negotiate with ourselves," Boehner said. | "We can't negotiate with ourselves," Boehner said. |
| The letter, released on Monday, falls short of Obama's declared minimum position because although they offer $800bn in new tax revenues, the authors refuse to accept a tax hike for the top 2%. Even so, the joint letter has sparked considerable in-fighting within Republicans circles, with ultra-conservatives accusing Boehner of betraying the cause by accepting any revenue increases at all. | The letter, released on Monday, falls short of Obama's declared minimum position because although they offer $800bn in new tax revenues, the authors refuse to accept a tax hike for the top 2%. Even so, the joint letter has sparked considerable in-fighting within Republicans circles, with ultra-conservatives accusing Boehner of betraying the cause by accepting any revenue increases at all. |
| Senator Jim DeMint, a leading figure in the once dominant Tea Party faction of the party, said: "This isn't rocket science. Everyone knows that when you take money out of the economy, it destroys jobs, and everyone knows that when you give politicians more money, they spend it." | Senator Jim DeMint, a leading figure in the once dominant Tea Party faction of the party, said: "This isn't rocket science. Everyone knows that when you take money out of the economy, it destroys jobs, and everyone knows that when you give politicians more money, they spend it." |
| Prominent conservative thinktanks, such as the Koch-backed Americans for Prosperity, and Heritage Action for America, also put out statements accusing Boehner of reneging on the promise to resist tax increases on all Americans. | Prominent conservative thinktanks, such as the Koch-backed Americans for Prosperity, and Heritage Action for America, also put out statements accusing Boehner of reneging on the promise to resist tax increases on all Americans. |
| Fiscal conservatives also want to see more pressure put on Obama to come up with tougher spending cuts. "It can't be revenue now, spending reductions later," said John Engler, president of the Business Roundtable that includes the chief executives of companies such as Boeing and GE that collectively have annual revenues of more than $7tn. | Fiscal conservatives also want to see more pressure put on Obama to come up with tougher spending cuts. "It can't be revenue now, spending reductions later," said John Engler, president of the Business Roundtable that includes the chief executives of companies such as Boeing and GE that collectively have annual revenues of more than $7tn. |
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