With Debt Limit Maxed Out, Lawmakers Hold Firm On Remedy

By John R Parkinson

May 16, 2011 1:49pm

ABC News’ John R. Parkinson (@JRPabcDC) reports: 

As the United States maxed out on its statutory debt limit earlier today, House Speaker John Boehner is sticking to the Republican position against a tax increase while calling on President Obama and Congressional Democrats to come up with an amicable plan that cuts a greater value than any increase to the country’s credit card.

“Americans understand we simply can’t keep spending money we don’t have. Spending-driven deficits, record debt, and the threat of tax hikes are smothering our economy with uncertainty and making it harder for small businesses to hire new workers,” Boehner, R-Ohio, said in a statement Monday afternoon. “There will be no debt limit increase without serious budget reforms and significant spending cuts – cuts that are greater than any increase in the debt limit.”

Boehner noted that the Republicans’ “Path to Prosperity” budget resolution has already passed a House vote and predicted it would “put us on a path to balance the budget and pay down our debt, spur job growth, and save programs like Medicare for current retirees and future generations.”

Last Friday, the Social Security and Medicare Boards of Trustees announced the country's benefit programs for the elderly will be exhausted sooner than expected due to the economic downturn.

Today, Boehner said that as Baby Boomers being to retire, it’s “an urgent reminder that we need to act now to protect those in or near retirement and save these programs for future generations.”

“Half-measures and gimmicks won’t get the job done, and tax hikes will only hurt job creation and do more damage to our economy,” Boehner stated. “We’ve taken action; now it’s time for Senate Democrats and President Obama to put forward a serious plan of their own.”

Meanwhile, House Minority Leader Nancy Pelosi is in New York today with her two appointees to the Vice President’s deficit talks at Blair House, Assistant Democratic Leader James Clyburn, D-South Carolina, and Chris Van Hollen, D-Maryland, the ranking member on the Budget Committee. 

According to an aide in the Minority Leader’s office, Pelosi is spearheading meetings with members of Partnership for New York City, including CEOs of businesses that represent some of the nation's largest employers and most important international companies.  

The source added that the meetings are part of an ongoing effort by Pelosi to engage the group in economic issues like comprehensive immigration reform, investments in infrastructure, 9/11 health benefits and the importance of commerce in New York City.

In a letter sent to each Member of Congress this morning, Treasury Secretary Tim Geithner wrote to Congressional leadership to announced he is suspending investments in federal retirement funds to create room and enable the government to keep borrowing in debt markets.

Geithner said the move is intended to create space under the debt limit so that Treasury can continue funding the government’s obligations until Congressional negotiators are able to strike a deal to increase the debt limit.

He also urged Congress to quickly raise the debt limit in order to uphold “the full faith and credit of the United States.”

“I have written to Congress on previous occasions regarding the importance of timely action to increase the debt limit in order to protect the full faith and credit of the United States and avoid catastrophic economic consequences for citizens,” Geithner noted. “I again urge Congress to act to increase the statutory debt limit as soon as possible.”

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