Greg Sargent has the story HERE:
Big news. Eric Cantor has just made it official: The GOP leadership is prepared to agree to a three month debt ceiling hike. This is a major de-escalation of the crazy and effectively means Republicans have all but taken the threat of default off the table completely.
First, the key bit from Cantor’s statement:
We must pay our bills and responsibly budget for our future. Next week, we will authorize a three month temporary debt limit increase to give the Senate and House time to pass a budget. Furthermore, if the Senate or House fails to pass a budget in that time, Members of Congress will not be paid by the American people for failing to do their job. No budget, no pay.
Here’s why this matters: This increases the debt ceiling to authorize borrowing to pay the country’s bills well into April. That punts the debt limit deadline until after the deadline for funding for the government to run out, which is on March 27th. In other words, Republicans will now use the threat of a government shutdown along with the coming expiration of the sequester to extract the spending cuts it wants. Presuming this all gets resolved by then, or soon after, it means the threat of default is no longer a factor. This will all but certainly get resolved in advance of this three month deadline, and a long term debt limit hike will get attached to that agreement.
On the debt ceiling, at least, this is a complete cave.
Sounds like the best possible strategy for the Republicans. Now the Senate Democrats can weigh in with their cost cutting plans as well.
Plus, this will give the President plenty of time to follow the law and submit his budget too.
Here is more on this topic:
http://politicalticker.blogs.cnn.com/2013/01/18/house-republicans-announce-vote-on-three-month-extension-of-debt-ceiling/?hpt=hp_bn3
House GOP Whip Kevin McCarthy told CNN that “what we’re trying to do is put us on a path to a balanced budget.”
“April 15th is the deadline for both houses to pass a budget,” he continued. “A budget is a roadmap to not only where you are but where you can go. Unfortunately the House has passed one the last two times, but the Senate has not, and what has that created? A $16 trillion debt. An idea of not knowing where our economy is gonna go.”
The short-term extension strategy represents a departure from recent discussions where Republicans pushed that any increase in the debt limit must include spending cuts that amounted to the same size of the increase.
And Republican leaders seem to be steering clear of any suggestions that the party is willing to risk allowing the government to default on its loans–the consequence should the debt ceiling be kept as is–as a way to put pressure on the White House and Senate Democrats to carve out drastic spending cuts.
“We are not going to default- I don’t know of anybody, and I move in fairly fiscally conservative circles within our party – none of us are talking about default,” said conservative GOP Rep. Mick Mulvaney of South Carolina. He also signaled he agreed with the new House GOP strategy.
The Republican House bugler has sounded retreat so they can regroup and come up with a new (?)budget which of course will call for big cuts in Medicare, Medicaid, Social Security, unemployment and food stamps while preserving corporate tax breaks, special interest and defense funding. In other words all the things that cost them the November election.