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. Steven-NY

    Ladies and Gentleman. Everyone is too blame. A simiple math lesson – YOu cut 2.2 trillion but bowrrow an additional 2.6 trillion YOU HAVE TAKEN ON MORE DEBT – not a good thing (see Greece)

    You can not cut only cut social programs. Some companies and the rich (GE & Soros) must actually pay taxes. I have no problem paying more taxes. BUT I have a problem paying more taxes when GE and Soros pay none.

    July 29, 2011 at 5:40 pm | Report abuse |
    • Jon

      EXACTLY!...

      July 29, 2011 at 6:19 pm | Report abuse |
    • Katherine

      You're right, Steven. And I have a problem with taking a cut in Social Security and Medicare when members of congress, most especially the republican members who seek to destroy our Sorcial Security pension program, will keep their tax subsidized pension and salary without any cuts, at all.

      July 29, 2011 at 6:35 pm | Report abuse |
    • Phil in Oregon

      Another simple math lesson: you only put $100 in your checking account, you can't take $200 out. That's called deceptive practice, and it will get you put in jail. Also, if you borrow money, you WILL have to pay it back. With interest.

      July 29, 2011 at 7:31 pm | Report abuse |
    • Guest comment

      Yup, balance includes increased revenues. Only Tea Party doesn't understand that and are willing to take down the country like a spoiled 3 year old.

      July 29, 2011 at 10:56 pm | Report abuse |
  2. puchis

    Why would the senate pass something developed by the GOP house of Rep's? They have not passed anything from them this sesson and I guess are more interested in keeping a perfect record than getting the anything done.

    July 29, 2011 at 5:42 pm | Report abuse |
  3. Georgia Hull

    Legalize marijuana. Pay the farmer to grow it. Tax it. Agriculture can save America if we are allowed to. Signed a Kentucky farmer.

    July 29, 2011 at 5:45 pm | Report abuse |
  4. tomas

    The damage is already done. The credit rating will be lowered regardless what bill is passed. And mind you, its almost certain the bill passed by congress will suck.

    None of these bilsl address increasing gov't revenue, which is partly needed to get us out of the hole. We are too deep in the hole for cuts to work alone. Thats the reality america needs to understand. what kills me is that ronald reagan and tip o'neil understood this in 80's and it worked. I cant believe these idiots are so intransigent on idealogy. They a have good model to follow from history.

    July 29, 2011 at 5:46 pm | Report abuse |
  5. Jon

    There is a fairly easy and straightforward way out of this: Tell the IMF, the UN, the international investment bankers, financiers and the rest of those hell bent on selling the US out to the foreign interests to go jump in a lake.

    It is time the US start worrying about its' own issues and stop worrying about the "international community"...It is time the US STOP BAILING OUT the major corporations and banks under this godless TARP–which should have NEVER been passed to begin with.

    We should immediately CUT all funding to foreign aid except to Israel. DISSOLVE the federal reserve (central bank), DISSOLVE the ATF and DHS–both are HUGE failures, and should be immediately and forever dissolved.

    We should return the US BACK TO THE GOLD STANDARD and tell the treasury to print money backed by gold.
    The debt would be gone IF the people of this nation would GROW A BACKBONE and tell the government to quit pandering to the international bankers, financiers, corporations and "international community" and START doing what is in the interests of the US.

    July 29, 2011 at 5:47 pm | Report abuse |
    • Nellie Thomas

      AMEN !!!!!

      July 29, 2011 at 6:16 pm | Report abuse |
    • jeannine

      where is the like button!

      July 29, 2011 at 6:24 pm | Report abuse |
    • Ana

      AMEN! MAY I SHARE??

      July 29, 2011 at 6:50 pm | Report abuse |
  6. SIMPLE TRUTH

    "When a government is dependent upon bankers for money, they and not the leaders of the government control the situation, since the hand that gives is above the hand that takes… Money has no motherland; financiers are without patriotism and without decency; their sole object is gain.”

    July 29, 2011 at 5:48 pm | Report abuse |
    • SIMPLE TRUTH

      – NAPOLEON BONAPARTE

      July 29, 2011 at 5:53 pm | Report abuse |
  7. John F Mann

    As for Federal government debt, some might find the following informative;

    http://www.helium.com/items/1586094-national-debt-federal-deficit

    However, much more important than government debt is total debt taken on by the private sector.......which includes tens of millions of citizens who have overextended credit card mortgage debt.

    July 29, 2011 at 5:49 pm | Report abuse |
  8. SIMPLE TRUTH

    “Let me issue and control a nation’s money and I care not who writes the laws.”

    – Mayer Amschel Rothschild (1744-1812), founder of the House of Rothschild.

    “… our whole monetary system is dishonest, as it is debt-based… We did not vote for it. It grew upon us gradually but markedly since 1971 when the commodity-based system was abandoned.”

    – The Earl of Caithness, in a speech to the House of Lords, 1997.

    July 29, 2011 at 5:50 pm | Report abuse |
  9. Celeste

    The things that outrage me the most is that The Republican party is playing a dangerous game at a dangerous time. They continue to work against the President and the best interest of the country. The Republican Congress is not only dysfunctional, but they are the perfect example of incompetence, useless trouble makers, without an ounce of any reasonable reasoning skills. The term a empty wagon makes a lot of noise. The more time you take to resolve what would have been a simple issue blown into a major problem now makes us an easier target for every fool out in the world. The other thing that I am furious about is that we are approaching the anniversary of 911. The dumb clucks Boehner and Cantor haven’t and can’t again pass a simple bill. Laying of FAA workers are beyond me. We are loosing 200 millions dollars a day, because the idiots couldn’t pass this bill. The airlines have picked up a windfall because of the incompetence Republican leadership. The President should up the entertainment since you Republicans are failures beyond imagination. The treasury department needs to hold your checks until you earn them. The President didn’t make these messes and he has been cleaning up your do do since he took office.

    July 29, 2011 at 5:51 pm | Report abuse |
    • Jon

      (1) the democrats have not worked in favor of the US.
      (2) Democrat or Republican-they are all the same. They jump to the tune of international bankers and the IMF.
      (3) The Sky will NOT fall on Aug 3.
      (4)Everything they are telling you is a LIE.
      (5) All of this is fear mongering.
      (6) They WANT you afraid–you are easily controlled that way.

      ALL of the above is the TRUTH...

      July 29, 2011 at 5:54 pm | Report abuse |
    • Chip

      Democrats and Republicans have only one goal here. Each wants to make the other look bad. Both sides have been successful at that... though making either side look bad is not difficult at all.

      July 29, 2011 at 6:51 pm | Report abuse |
  10. BobbyB

    Here's a place to start....every Congressman/Gongresswoman, Senator, the President, every worker in the Federal Government take an immediate 50% wage cut starting Tuesday August 1, 2011. They stay at that cut pay level until the entire US debt is paid off. That means as well, though, that they will pay less taxes because of less take home pay. This would be a non-partisan approach as every Democrat and Republican within the Federal Government will be affected and will set the correct stage for others within the country to follow. The salary cut will also then result in them paying less income taxes because they will be in a lower tax bracket. All the other "blue" collar workers in the country will see their earnings as being higher, they will also retain their jobs because the companies they work for will not be taxed more and as adversely affected by a national rating downgrade. When the fat cats in Washington have come to grips with how to control their personal spending from their pay check reduction then I am sure they will be more sensitive to managing the US economy debt load without partisan antics! They will have learned how to manage with less and will have learned how important it is for people to have enough money for food, health care, housing, clothing, personal security, and transportation and understand that their hundreds of thousands in salaries to pay for their 'toys' are NOT necessary, at least not as necessary as the basic necessities of life!

    July 29, 2011 at 6:03 pm | Report abuse |
    • Don

      Except the real money is in campaign contributions, speaking, and passing legislation which favors your investments.

      July 29, 2011 at 6:08 pm | Report abuse |
    • Nellie Thomas

      LOVE IT!!!

      July 29, 2011 at 6:19 pm | Report abuse |
  11. Mark Sand

    The rich and wealthy in this country are taxed far less in this country, proportionally, than in other first world states. Also, we're fighting needless wars and have a needlessly high expenditure on defense, over 40% of all the world's defense spending is by our government. Instead of trying to balance the budget on the backs of the poor and elderly, lets start closing loopholes that the rich exploit, and reduce our defense spending.
    Boehner and GOP suck.

    July 29, 2011 at 6:05 pm | Report abuse |
  12. lar

    We are a clearly a democracy of morons. HLM got it right:

    "Democracy is the theory that the common people know what they want and deserve to get it good and hard." –H.L. Mencken (1880-1956)

    July 29, 2011 at 6:06 pm | Report abuse |
  13. Don

    intangibles tax

    July 29, 2011 at 6:09 pm | Report abuse |
  14. Yulia

    We get the government we deserve, and because of the abject stupidity of so many of our fellow citizens who voted in such subversive forces as Michelle Bachmann, we're all going to literally pay for these grave errors in judgement. With our mortgages, loans, and credit.

    If it wasn't clear to you before, it ought to be now: voting for a Republican is not in your best interest unless you make more than $1,000,000 a year. Wake up and stop ruining the rest of our lives.

    July 29, 2011 at 6:28 pm | Report abuse |
  15. Kylie

    This latest vote in the house is an excersize in futility. This will not pass the senate.

    July 29, 2011 at 6:40 pm | Report abuse |
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