Win McNamee/Getty Images
House Majority Leader Eric Cantor (R-VA) on June 21.
House Majority Leader Eric Cantor (R-VA) on June 21. Win McNamee/Getty Images
Second Update at 3:11 pm ET
First Update at 2:37 pm ET
The deadly serious game of fiscal chicken being played by Democratic and Republican policymakers in Washington took a troubling turn with the news that Rep. Eric Cantor (R-VA), the House majority leader, was boycotting Thursday's negotiations to raise the debt limit before the Aug. 2 deadline.
Cantor said he won't attend the negotiating session, led like previous ones by Vice President Biden, because congressional Democrats are insisting that tax increases be married with spending cuts.
Sen. Jon Kyl (R-AZ) also has apparently dropped out of the negotiations. He issued a joint statement with Sen. Mitch McConnell, the Senate minority leader.
Tax increases are out of the question, said Cantor. The GOP-led House won't pass them. Thus, he's calling for President Obama to "resolve" the issue.
Obviously, since Cantor is saying that as far as Republicans are concerned any tax increase is off the table, that leaves the president with something of a Hobson's choice. But there you have it.
From Cantor's statement:
"There is not support in the House for a tax increase, and I don't believe now is the time to raise taxes in light of our current economic situation. Regardless of the progress that has been made, the tax issue must be resolved before discussions can continue. Given this impasse, I will not be participating in today's meeting and I believe it is time for the President to speak clearly and resolve the tax issue. Once resolved, we have a blueprint to move forward to trillions of spending cuts and binding mechanisms to change the way things are done around here."
Republican congressional leaders have said they intend to raise the debt limit past its current $14.3 trillion level to avert the federal government defaulting on its obligations. Virtually all top officials say such a default would be unthinkable.
But Republicans have also said to reach the agreement, they need substantial spending cuts. And no tax increases.
Cantor's move appears to raise the pressure on Obama and Speaker John Boehner to move the talks to a successful conclusion.
According to the White House press pool report, presidential press secretary Jay Carney told reporters traveling with the president to Ft. Drum Army base in New York Thursday that the president's team is pretty much where they expected to be at this stage: Obama and congressional leaders must now sit down to gain agreement on the thorniest issues. Biden's task was to identify "common ground," he said.
He said Obama and Boehner met before the president's Wednesday night Afghanistan speech. But Carney didn't say whether Boehner told Obama that Cantor was exiting the talks.
Carney also said Obama seeks a "balanced" way forward that doesn't give the wealthy big tax cuts and individual seniors thousands of dollars in higher Medicare costs.
An excerpt from a Bloomberg News story by Laura Litvan and Heidi Przybyla:
"This is going to lay some black crepe over the discussions," said Bill Hoagland, a budget adviser to Republican congressional leaders from 1982 to 2007. "We knew we were going to get to this very difficult philosophical issue of taxes and spending," he said. "This will have to be a decision the president himself will have to weigh in on with" House Speaker John Boehner.
In a statement, Jonathan Cowan, the president of the group Third Way, an organization of centrist Democrats that seeks pragmatic solutions to the nation's problems, said:
In the midst of tenacious economic downturn – and on a day when the markets have plummeted – Congressman Cantor's decision to abandon the bipartisan budget talks chaired by Vice President Biden creates a dangerous and unprecedented level of uncertainty for our economy.
His actions jeopardize the full faith and credit of the United States and threaten to bring on a new economic calamity that is both foreseeable and preventable.
Third Way has long advocated aggressive action to deal with our budget deficit. But such action must be balanced, for both substantive and political reasons. Walking away from a negotiation based on a belief that one side of the equation – taxes – should be completely off the table is economically unwise and corrosive to the spirit of cooperation and bipartisanship that the parties to the talks were attempting to foster.
However, all is not lost – we believe the President and Speaker Boehner will deliver a balanced solution by engaging in the compromise negotiations that Mr. Cantor apparently cannot stomach.