In a posting on his blog, Boehner just managed to snag any progress in the debt ceiling negotiation, saying that the president "is trying to set up a no-win situation for taxpayers: either he gets his $2.4 trillion blank check, or America defaults", generatinged much despised PTSD visions of Hank Paulson' staccato threats in Congress, and in doing so making any compromise he may have been pursuing with the Tea Party virtually impossibly and certainly nearly unpracticable with just 3 days before the absolute legal deadline this Thursday. Perhaps that is just the reason why bonds suddenly ripped. Remember: bonds will be bought if sendng is curtailed and no incremental debt will be layered... to a point. Should the US default, buying will turn to selling, first very slowly, then very fast.
Treasury response to blog post:
From Boehner's full blog post:
Common-Sense GOP Effort Will Prevent Job-Crushing Default & Deny President Obama a $2.4 Trillion Blank Check
Today, House Republican leaders will discuss with lawmakers a new framework designed to prevent a national default while ensuring any debt limit increase granted to President Obama includes spending reforms and cuts that exceed the debt limit hike. This common-sense plan is aimed at stopping President Obama’s indefensible quest for a debt limit increase that would run past the next election without a process in place to ensure spending is being cut as the debt ceiling is being raised. As Speaker Boehner said yesterday on FOX News Sunday, “I know the president's worried about his next election. But my God, shouldn't we be worried about the country?”
President Obama desperately wants a large debt limit increase that will take him past the next presidential election.
- The president is demanding a $2.4 trillion debt limit increase all at once – without spending cuts that exceed the hike – and refusing to accept a two-stage process that would ensure government spending continues to be cut as the debt ceiling is raised. Treasury Secretary Tim Geithner went on the Sunday shows yesterday to “insist” that any agreement “remove the possibility of a default from the politically heated presidential campaign season.”
- As Majority Leader Cantor said yesterday, the president's stance is purely political, and indefensible. “He cannot sustain or defend putting politics above the country’s interests in this situation,” Leader Cantor added.
Granting the president's request would amount to giving the president a $2.4 trillion blank check he can use to continue the spending binge that has driven our nation to the brink of a job-destroying downgrade and default.
- The president has made it pretty clear he sees this debate as inconvenient compared to his desire to create more ‘stimulus’ programs. “I’d rather be talking about stuff that everybody welcomes – like new programs,” he said at a recent press conference.
- He is trying to set up a no-win situation for taxpayers: either he gets his $2.4 trillion blank check, or America defaults.
Speaker Boehner and Congressional Republicans have been clear that to pass the House, any debt limit increase must be accompanied by spending cuts that exceed the amount of the debt limit hike.
- The American people overwhelmingly support this principle of “cut more than you hike.” According to a recent CNN survey, 66 percent of Americans would only support an increase in the debt limit if “substantial spending cuts and caps on future spending were approved.” This is in addition to a Resurgent Republic survey that found Americans only support raising the debt limit “in exchange for substantial spending cuts and a commitment to reduce the deficit.”
- More than 150 economists have backed “cut more than you hike,” stating on June 1 that “an increase in the national debt limit that is not accompanied by significant spending cuts and budget reforms to address our government’s spending addiction will harm private-sector job creation in America. It is critical that any debt limit legislation enacted by Congress include spending cuts and reforms that are greater than the accompanying increase in debt authority being granted to the president.”
- Columnist Charles Krauthammer has called the “cut more than you hike” approach a “thing of beauty,” “eminently logical and easy to understand,” and “difficult for the president to refuse.”
Republicans have also been steadfast in calling for strict spending caps to control future spending, and a balanced budget amendment to the Constitution requiring Washington to stop spending money we don’t have.
- In stark contrast to President Obama’s politically-motivated request for a blank check, Republicans are committed to keeping spending in check this year, next year, the year after that, and so forth. That means implementing real spending cuts and reforms, like a Balanced Budget Amendment. “I continue to believe that a Balanced Budget Amendment is the greatest enforcement mechanism to bring Washington spending under control,” Speaker Boehner said yesterday.
Congress can deny President Obama a blank check and protect the American people by passing legislation to prevent a default that is consistent with the principles of the Cut, Cap, & Balance plan that passed the House with bipartisan support.
- Congressional leaders worked through the weekend in an effort to forge such a solution, and plan to move it through Congress this week to cut spending and prevent a national default that would destroy more American jobs.
The American people are still asking the question: ‘where are the jobs?’ And they know Washington’s spending binge is part of the problem.
- For its part, the Obama Administration maintains the economy is “absolutely” improving when it clearly is not. What’s more, a new report has surfaced that the White House’s latest effort to win over employers “has gone cold.” These are just more indications why we need to deny President Obama a $2.4 trillion blank check.
- For the sake of our economy and our future, we need to stop spending money we don’t have and start creating a better environment for long-term job growth. Cutting spending and preventing a national default will prevent more American jobs from being destroyed.