GOP Leaves Talks On Raising Federal Debt Ceiling

The Obama administration has set a hard deadline of Aug. 2 for Congress to come up with a deal on raising the debt ceiling, and pass it into law. But the parties have hit a stalemate on the issue of taxes.

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The debate over raising the federal debt ceiling has become, in effect, a debate about everything. Republicans say they want spending cuts as part of the deal. If there's no deal, the Obama administration says the U.S. risks default. If there is a deal, it could affect any federal program and tax. Actually, that last point is a matter of dispute. Republican negotiators walked out of talks, refusing to consider any revenue increases.

NPR's Andrea Seabrook reports on what happens now.

ANDREA SEABROOK: The negotiations are secretive, weighty and extraordinarily respectful. That's how just about everyone inside the room describes it. And for weeks, all eyes in Washington have been on those few lawmakers in the talks. Predictions for what could happen if they don't come up with a deal range from market disappointment to all-out economic collapse.

From the beginning of this week, it was clear that the group had reached an important moment.

ERIC CANTOR: Its crunch time in those meetings.

SEABROOK: House Majority Leader Eric Cantor spoke to reporters on Tuesday.

CANTOR: When it gets tough, it's up to the parties involved to focus on making the case. And I'm going to continue to go in there and make the case that House Republicans want.

SEABROOK: Republicans' case, said Cantor, is that trillions in cuts must be made, without a penny of tax increases on any person or business. On Wednesday, Cantor still sounded engaged in the negotiations.

CANTOR: I continue to remain optimistic that we can get some real savings. And as the speaker has laid out, we need trillions of dollars of savings.

SEABROOK: But by yesterday morning, Cantor decided he'd done all he could. He called Vice President Biden, the leader of the talks, and then announced he was done.

House Speaker John Boehner spoke to reporters.

JOHN BOEHNER: I understand his frustration. I understand why he did what he did. But I think those talks could continue, if they're willing to take those tax hikes off the table.

SEABROOK: Boehner did not outline how the talks could continue without any Republicans at the table, but it became clear, later yesterday, that he himself may now get involved.

The other Republican inside the talks, Senator John Kyl of Arizona, quickly followed Cantor in leaving the negotiations. Senate Democratic leader Harry Reid said he's disappointed with the Republicans.

HARRY REID: We can't give up. These issues that we're dealing with are far too serious. Democrats are not going to give up on cutting our deficit and creating jobs. We're not going to give up on the American people. And that appears to me, what's happened with these people walking out on these discussions.

SEABROOK: We have to act like adults here, said Reid. And he pointed out that some of the country's most important budget makers were putting enormous time and energy into a serious, bipartisan solution.

REID: They have the vice president of the United States, secretary of the Treasury, head of the Office of Management and Budget coming up here virtually every day - coming up here. To have first leader Cantor and then Senator Kyl just drop out of the discussions, that is untoward. I'm terribly disappointed.

SEABROOK: Later yesterday evening, Vice President Biden released a statement, saying the goal of the talks was always to find the common ground, and identify the stickiest points, and then hand over the talks to the government's top brass - President Obama, Senate leader Reid, then House speaker John Boehner.

But where they go from here is just as cloudy. House Republicans repeat with unwavering certainty that they will not pass a bill that increases taxes, or even ends tax breaks for specific industries or businesses.

There is a chance that moderates of both parties could join together and pass a compromise bill in the House, but that would require top Republicans to allow that compromise to come to the floor. Asked if he would do that, Boehner said yesterday...

BOEHNER: If ands and buts were candy and nuts, every day would be Christmas.

(SOUNDBITE OF LAUGHTER)

SEABROOK: A somewhat inscrutable answer, and that appears to be the point.

Andrea Seabrook, NPR News, the Capitol.

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