US debt default talks grow more contentious
Talks between President Barack Obama and congressional Republicans grew increasingly contentious on Monday, as party leaders rejected his call to raise taxes on the wealthy as part of a bipartisan deal to restrain the nation’s mounting debt.world Updated: Jul 13, 2011 02:26 IST
Talks between President Barack Obama and congressional Republicans grew increasingly contentious on Monday, as party leaders rejected his call to raise taxes on the wealthy as part of a bipartisan deal to restrain the nation’s mounting debt.
News conferences by Obama and house speaker John Boehner, R-Ohio, served as a testy prelude to an afternoon bargaining session that only emphasised the partisan divide, according to people on both sides with knowledge of the closed-door discussions.
Obama challenged Boehner to buck the anti-tax hard-liners in his party who are blocking the path to a landmark compromise to reduce borrowing by as much as $4 trillion over the next decade.
Boehner and house majority leader Eric Cantor, R-Va, responded by urging Democrats to settle for a more modest cuts-only deal that would save $2.4 trillion but would not touch tax breaks for the nation’s richest households.
In addition to major cuts to domestic agencies, the GOP proposal calls for slicing about $250 billion from Medicare over the next decade by asking well-off seniors to pay more for health coverage, placing new restrictions on Medigap policies and putting in place new co-payments and cost-sharing provisions for home healthcare among others.
Obama rejected the GOP plan, arguing that he could not ask “moderate-income seniors to bear $500 or more of additional costs when you couldn’t ask the most well-off American to give an extra $5 to getting the deficit down.”
Negotiators are now back to the drawing board with just three weeks until August 2, when the government risks defaulting on its obligations without additional borrowing authority. They agreed to meet again late Tuesday, and Obama said they will meet daily if necessary to seal a deal. “We might as well do it now. If not now, when,” Obama said.
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