The debt ceiling battle: Where things stand on a vote
House Speaker John Boehner arrives at the Capitol Friday morning.
July 29th, 2011
09:47 PM ET

The debt ceiling battle: Where things stand on a vote

The federal government has four days left to raise the nation's current $14.3 trillion debt ceiling, the Treasury Department said. A failure to do so will risk an unprecedented national default.

If the debt ceiling is not raised by Tuesday, Americans could face rising interest rates and a declining dollar, among other problems.

As the cost of borrowing rises, individual mortgages, car loans and student loans could become significantly more expensive. Some financial experts have warned of a downgrade of America's triple-A credit rating and a potential stock market crash.

Without an increase in the debt limit, the federal government will not be able to pay all of its bills next month. President Barack Obama recently indicated he can't guarantee Social Security checks will be mailed out on time. Other critical government programs could be endangered as well.

Where do things stand in the fight to raise the debt ceiling?

House

Senate Democrats on Friday blocked the latest House Republican proposal to cut spending and increase the federal debt ceiling, setting up a weekend of negotiations to seek a deal that would avoid a potential federal default next week.

Earlier Friday, House Republicans passed Speaker John Boehner's latest proposal, overcoming opposition from Democrats and tea party conservatives. But Democrats had vowed to defeat it in the Senate, where they have the majority.

Boehner's plan calls for $917 billion in savings over the next decade, while creating a special congressional committee to recommend additional savings of $1.6 trillion or more. It would allow the debt ceiling to be increased by a total of roughly $2.5 trillion through two separate votes. The $2.5 trillion total would be enough to fund the federal government through the end of 2012.

The plan originally called for a congressional vote on a balanced budget amendment to the Constitution by the end of the year. Boehner has since reached out to disgruntled conservatives by amending the plan to require congressional passage of such an amendment as a condition for raising the debt limit by the full $2.5 trillion, according to two GOP congressmen.

The vote was scheduled to have taken place on Thursday night, but Republican leaders postponed the vote amid signs they did not have enough support to pass it.

Senate

Senate Majority Leader Harry Reid's plan would reduce federal deficits over the next decade by at least $2.2 trillion while raising the debt ceiling by $2.7 trillion. Reid has promised additional cuts will be included in the final version of his legislation - enough to meet the GOP's demand that total savings should at least equal any total debt ceiling hike.

Reid's plan would cut spending by $1.8 trillion. Roughly $1 trillion in the savings are based on the planned U.S. withdrawals from military engagements in Afghanistan and Iraq.

Reid's plan also would establish a congressional committee made up of 12 House and Senate members to consider additional options for debt reduction. The committee's proposals would be guaranteed a Senate vote with no amendments by the end of this year.

Reid said Friday morning that he "must take action" on the Senate's legislation by the end of the day.

Obama

Obama has endorsed Reid's plan and threatened a veto of Boehner's plan. The president strongly opposes any bill which doesn't raise the debt ceiling through the 2012 election. Obama has promised to veto any short-term debt ceiling extension unless it paves the way for a "grand bargain" of more sweeping reforms and revenue increases.

On Friday, Obama urged Senate Democrats and Republicans to take the lead in congressional negotiations. He said the House GOP plan "has no chance of becoming law." Obama also urged Americans to keep contacting members of Congress in order "to keep the pressure on Washington."

The president made a nationally televised plea for compromise Monday night, though he also criticized Republicans for opposing any tax hikes on the wealthy.

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Filed under: Budget • Business • Economy • Finance • Politics
soundoff (748 Responses)
  1. gordyb

    So what do the republicans in the house do? Pass an even more conservative bill....are they stupid or what? They talk about the president already running for office, this entire nightmare they created is all about 2012 and everyone knows it. They over reached just like the governers in Wisc, NJ and Fla. All future one termers if they don't get recalled before then. The president will do what is necessary and the fallout for the GOP will occur next year. All the cult tea party reps will be voted out. We may be stupid once but not twice.

    July 29, 2011 at 2:54 pm | Report abuse |
    • FajitaBob

      H#ll yes, it's about 2012. And every day from here on out that we spend a BILLION dollars every single day in idebt nterest payments alone! How can you think ANY idea is too conservative? Fiscal liberalism is a disorder of the brain.

      July 29, 2011 at 3:02 pm | Report abuse |
    • Steve S

      So true and what is the tea party? It's the far right racist division on the republican party, they didn't even form till we had a Black President and they will do ANYTHING to try and bring him down. This will destroy the republican party in 2012.

      July 29, 2011 at 3:35 pm | Report abuse |
  2. FajitaBob

    I can't believe there is even one person in this WHOLE COUNTRY who believes these politicians should spend more of our money!!! What the H#LL is wrong with liberals????? Really? Please, someone tell me why you think increasing spending is a good idea. PLEASE! I want to understand what is wrong with you!

    July 29, 2011 at 2:57 pm | Report abuse |
    • srd

      as soon as repubs take away hedge fund and corporate jet tax breaks. like to hear your thoughts on that

      July 29, 2011 at 3:11 pm | Report abuse |
    • Sheldon Collins

      Yourwars cost more and the jobs (middle class) that used to purchase U.S. products and bare the weight of revenues were farmed out beginning with Saint Reagan.

      July 29, 2011 at 3:12 pm | Report abuse |
    • Herbie Walker

      Like suply side economics, fajitas are passe (though still delicious).

      July 29, 2011 at 3:13 pm | Report abuse |
    • Sheldon Collins

      Oh, by the way...Stand up tall and use your real name.

      July 29, 2011 at 3:13 pm | Report abuse |
    • GSummer

      It's not about increasing spending. This is about paying our bills. This is the equivalent of your racking up a credit card bill and once the bill comes saying ... sorry, but I'm not willing to pay for that cause it is too much. Spending is about the budget. When congress passes a budget that has more money going out than going in ... they are in fact agreeing to borrow money. Now they gotta pay for it. I agree spending is out of control ... but that is a separate fight. Pay the bills and then argue with your spouse about spending too much and figure out how to get spending under control.

      July 29, 2011 at 3:19 pm | Report abuse |
    • joe-shmo

      it's very simple, it not possible to run contry with current level of revenu.
      If you like small govermt look at any 3rd world countries. if you like how people leave there, move.
      the paradox here, that you want to have everything w/o paying for it. You probably enjoy interstate highways, ability to go to the hospital, ablility to send your kids to public school & etc. On other hand your benefiting from other goverment sponsored research. As en example: Internet, Satellite TV and so on. if you think it's not needed than pick yourself new country.

      July 29, 2011 at 3:21 pm | Report abuse |
    • GSummer

      @Sheldon ... its "our wars" not your wars. It's not a republican or a democrat war. It's an American war, an American debt, and an American problem. This stupid party line bickering is nonsense.

      July 29, 2011 at 3:21 pm | Report abuse |
    • sumday

      I would also like to know what is wrong with you? I agree that spending needs to be cut, I also think that tax loopholes which allow GE, BOA, ect to pay nothing need to be closed (something the GOP oppose), but what I don't agree with is an immediate halt. You want to understand? what happens when your going 180 mph and come to an instant stop? please answer that! Now compare that to a putting on the breaks and slowing down. Furthermore this is all for things that we have ALREADY pledge to pay! I can’t call my credit card up and say oh those things I bought I don’t want to pay for anymore. Please try and understand what inflation is before you talk. If we default your dollar will very quickly become worth 10 cents- do you think you can survive when gas prices jump to $50/gallon, or when a loaf of bread cost $30 but you still get paid the same? Interest will be unbearable in fact what you complain about and fear is EXACTLY what you will be causing by not raising this ceiling. Just ask yourself how defaulting on any of your credit will ever help you? The fact is if we default we will still have the EXACT SAME BILLS, but now bc of a default our dollar is worth much less (which means our debt really just got bigger), while at the same time the interest rate on that debt will go up. If you default on your card you pay a penalty fee, and your interest rate goes up which means you have a higher payment each month, so please tell me how that helps us? Please I really want to understand why you think defaulting is good for America? Just tell me how making the dollar worth 10cents bc of a default benefits us? We can survive with debt as we have never in our history been out of debt, we can not survive if the world drops the dollar and prices on everything from gas to food to toilet paper jumps sky high. If you think it is such a good idea move to Mexico and see how you like the standard of living there bc that is how we will be if a default happens.

      July 29, 2011 at 3:21 pm | Report abuse |
    • John S

      Raising the debt ceiling does not spend one extra cent! It's not about spending more, it's paying the money that we've already spent. How come conservatives don't understand that? It's been explained time and time again.

      Here's an apt analogy: You get a credit card bill in for $500. It's due on Aug. 2nd. You can either pay it (raise the debt ceiling) and then cut back on spending or you can say "I don't want to pay $500" and ignore it. If you do the latter on Aug 3rd you'll still owe the $500, plus a $35 late fee and the card raises your interest rate. Which one is better for you?

      By not raising the debt ceiling the congress will be hurting the country financially causing us to owe MORE MONEY (in the form of higher interest rates.)

      July 29, 2011 at 3:28 pm | Report abuse |
    • Steve S

      None of this is about money. The tea party is about race and nothing else, they formed only after we had a Black President and they want him destroyed. Why was there no tea party to reign in George Bush's spending. The tea party does not understand how the economy works and has no foreign policy, they have only one policy, get the Black guy out. They are way too stupid to understand anything as complicated as the economy.

      July 29, 2011 at 3:40 pm | Report abuse |
    • Ignorance is bliss

      Fajita… you don’t understand the debt ceiling at all do you? Blaming liberals… come on, really. One side is trying to help the county and middle class and the other (sounds like your side) wants to keep the taxes low on corp. jets, oil and gas companies who make billions of dollars to 15% and not their normal AGI tax bracket, like everyone else. So who is helping the country, huh? Do you really think the trickle effect of these rich individuals will dribble down to us peons who pay our normal 15,25,28% AGI levels?
      Liberals, who do you think came up with the social security benefit you about to live on?

      July 29, 2011 at 3:55 pm | Report abuse |
  3. Proud Mary

    Stop scaring senior citizens with threats of the possibility of stopping Social Security payments; and simply stop paychecks to members of Congress. If there is no money, take paychecks away from Senators and Representatives and see an immediate compromise reached in this debt ceiling crises.

    July 29, 2011 at 3:07 pm | Report abuse |
    • Theresa

      My understanding is payments wil go out. With everything being electronic now its impossible to stop the issue of Social Security and other checks that quickly. The problem will be whether the Banks will honor the check seeing its based on rubber money.

      July 29, 2011 at 3:18 pm | Report abuse |
    • Sheldon Collins

      The only trouble with your proposal is that we have put them in the position where only they have the power to take away their salaries.

      July 29, 2011 at 3:18 pm | Report abuse |
    • Gaston

      Amen!!!!!

      July 29, 2011 at 5:16 pm | Report abuse |
  4. Sheldon Collins

    I seem to recall (not from personal experience) that World War II was partially financed by patriotic americans via "War Bonds." A simple creation of a deficit bond could resolve this entire issue. If my purchase of a defict bond went toward the deficit solely I would be willing to wait as the principle lowered for my bond to mature. Ofcourse it is a voluntary tax but I think my grandchildren and great-grandchildren are worth the sacrifice; afterall, they would be receiving the mature bond from me as well as a balanced economy. I challenge those who make over 250K to match my effort if they are true patriots. I make under 30K.

    July 29, 2011 at 3:08 pm | Report abuse |
  5. Dean

    Fajita Bob: if you want to talk about spending, who was it who spent $1Trillion on an unnecessary "war" in Iraq?

    July 29, 2011 at 3:10 pm | Report abuse |
  6. simple steve

    Big hand for america. Instead of dealing with budget cuts they worry more about their agenda's and money. What about the American people who make our country work? I guess we'll just have to suffer more because everyone is just in it for themselves.

    July 29, 2011 at 3:15 pm | Report abuse |
  7. Sheldon Collins

    What ! No one wants to buy back the deficit with bonds? I know it sounds too simple but the truth typically is.

    July 29, 2011 at 3:15 pm | Report abuse |
  8. Dawn

    The whole entire country is dangling by a sting, while the puppet masters in Washington, DC., are deciding what is best for the future of our economy, and the future of this nation. I personally have had enough of the pencil pushing, finger pointing, and the time game. Enough, there is no compromising, no waiting and no decision other then to be made then to vote in the best interest of this economy and to prove to our children, our nation, and that of the entire economic establishment including world trade, the stock market, the best interest as to not to break this country, but keep it rolling. Large Corporations, or small, non-profits, health care etc., pass this bill, and let this country rock on the way we all have been taught to do, good times or bad, we are Americans, I am sure there is a way to pay back all of these trillions of dollars. In the near future not tomorrow, and for all of the congressman and woman. WE ARE SICK OF WAITING>>>>

    July 29, 2011 at 3:16 pm | Report abuse |
    • Sheldon Collins

      Please join with me in promising to purchase a deficit bond so we can bypass the talking-heads.

      July 29, 2011 at 3:21 pm | Report abuse |
  9. Bob

    Obama is the worst thing that has happened in america since 9/11

    July 29, 2011 at 3:18 pm | Report abuse |
    • srd

      way to compare 9/11 to obama, you should be ashamed

      July 29, 2011 at 3:19 pm | Report abuse |
    • Bob

      Why Obama is destroying this country with his lack of experience and leadership
      he is selling us out to the muslum world
      the world has no respect for obama he is a joke
      Obama scares me I don;t feel safe I felt safer with Bush

      July 29, 2011 at 3:25 pm | Report abuse |
    • sumday

      Bob please tell me how Obama is worse than Bush? Also how is any of this Obama's fault? has he vetoed anything? Obama does not have the power to propose or pass bills only to veto them and todate the congress has not put any bill in front of him, so ALL the blame rest on congress not the president! Furthermore it was congress that passed the budget all this is just how we will pay for what they already passed. Again please tell me how this is Obama's fault when he is not the one who proposed the budget nor is he the one that passed the budget he simple did not veto it and you blame him for what congress proposed and passed? get your head out of your rear. Bush was the absolute worse president in history- there should be a law that if you have ever bankrupted a company you can't run the country. Bush bankrupted 3 companies and then the USA.

      July 29, 2011 at 3:33 pm | Report abuse |
    • Bob

      Obama is doing a cut and run in afganistan
      let us win this one Demorats too many of my friends died there and iraq I lost a leg but would go back in a minute to make sure we win
      obama is a coward he is onlty looking to get relected H e does not care about us Military and the military does not like him either

      July 29, 2011 at 3:46 pm | Report abuse |
    • Gaston

      Bob you must be confused & follower of republican lies....
      Obama.com would be the place for you... stop listening to the hear say of others for your facts... the idiot is the one that listen to others instead of look up information for themselves

      July 29, 2011 at 5:21 pm | Report abuse |
  10. Bob

    Obama has shown what a fraud he realy is

    July 29, 2011 at 3:18 pm | Report abuse |
    • sumday

      How so? I beleive the ball is and has been for a long time in the congress court. Congress (both parties) have not passed 1 thing, and all the president can do is veto something anyway so how is it his fault that congress won't do their job?

      July 29, 2011 at 3:35 pm | Report abuse |
    • Bob

      why is it congresses fault
      when Bush was Bresident Congress was owned by the demorats just as it is now

      July 29, 2011 at 3:39 pm | Report abuse |
  11. Bob

    Reade and pelosi are power crazed people

    July 29, 2011 at 3:21 pm | Report abuse |
  12. Joe

    Everyone is calling for compromise, but Harry Reid said this morning that he has the only compromise. Point 2: What member of Congress, regardless of party, would vot against a Balanced Budget Amendment, when the majority of people in America have to live within their means? How could we vote for someone like that?

    July 29, 2011 at 3:21 pm | Report abuse |
    • Bob

      Reade is using smoke and mirrors to dub people just like they did with Obama care (another joke)

      July 29, 2011 at 3:27 pm | Report abuse |
    • WL

      Majority of Americans live within their means and balance their bidgets? How many own their homes outright versus those who finance it by taking on debt? Pretty few I'd bet (and even less businesses). And FWIW, how can the US run a balanced budget when we literally don't know what might happen, from another Katrina to entry into another war to covering other horrendous disasters. financing of a national government is not a revenue vs expenses game. I agree the defitict is too big, but absent being able to take on debt, how can the government respond to emergency needs or finance long term projects?

      July 29, 2011 at 3:29 pm | Report abuse |
  13. beans65

    @Phranque
    see there we go again not willing to listen to the facts...Bush had TWO WARS that were not put in his budget and hence yes he was spending money even after he was out of office...to the tune of about 12 billion a month. lol thanks for pointing that out for me...so you can add up that lovely 9T plus according to CBO the roughly 4T from those wonderful unaccounted for wars and boom 13T just like that...your response is full of crap you made up or heard on fox news...and just so you know the unemployment rate was far higher than 4% when Bush was in office and even if you hate what im gonna say next its still fact...get on google and look up unemployment rates..you will find that unemployent number have gotten better since Obama has been in office...man that hurts...have to know where you came from to know where your going.

    July 29, 2011 at 3:22 pm | Report abuse |
    • Bob

      Stop with blamming Bush Obama has no plan to solve anything all he does is cry that bush did it all
      remeber who formed fanny mae it was dode and frank Denocrats
      this problem started withClinton so stop blamming Bush Liberals have no plan other than tax us out

      July 29, 2011 at 3:34 pm | Report abuse |
    • beans65

      @Bob
      yea and repubs are doing great...the reason we point out what bush did for this country is because the current repubs want to do the same thing to fix our problems...i do believe Obama wanted a revenue + cuts plan...and its not raising taxes, its simply gettting rid of the current cuts...we would be going back to a Clinton stile approach that worked very well if i remember.

      July 29, 2011 at 3:50 pm | Report abuse |
  14. Theresa

    I can't believe they are stretching this out till the very end.. Playing politics when senior citizens may not be able to eat next month. Kids may not be able to afford school and if interest rates go up the real estate market will suffer even more and even more people will file bankruptcy.. You want cuts here's one have them pay for their health insurance plan like we do no more free bees...Get rid of the on site doctor ready to take care of you on a whim go to the doctors office like the rest of us and wait six months for an apt. Take a pay cut....you want cuts start there congress and I'll be impressed

    July 29, 2011 at 3:24 pm | Report abuse |
  15. me

    Osama bin Laden may get his victory - the financial ruin of America, thanks to the take no prisoner mentality of the Republican Party. The Republicans plan robs from the poor to give to the rich.

    I hope America is watching and uses their vote more wisely in 2012. The Republicans aren't good for America. They create chaos and uncertainty whenever they gain power. Look at the markets.

    July 29, 2011 at 3:25 pm | Report abuse |
    • Bob

      Obama is a disaster
      I have no respect for that idiot
      Obama is nothing but a puppet for George Sores who's plan is tsocialism in america

      July 29, 2011 at 3:37 pm | Report abuse |
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